Defensive stocks

Defensive stocks are those that don’t tend to depend heavily on what’s going on in the wider economy for their growth.

Defensive stocks are companies that don't tend to depend heavily on what's going on in the wider economy for their growth (cf cyclical stocks). They are usually found in industries whose products are needed, come rain or shine, such as food retailers or water companies. Products such as tobacco or alcohol that are based on habit (or addiction) also tend to see fairly stable demand, and the companies that make them are seen as defensive as well.

A balanced portfolio should contain a mixture of cyclical and defensive stocks which can be altered as the economic climate changes.

See Tim Bennett's video tutorial: What are defensive stocks?

Most Popular

Is it cheaper to leave the heating on low all day?
Personal finance

Is it cheaper to leave the heating on low all day?

The weather is getting colder and energy bills are rising, but is it really cheaper to leave the heating on low all day or should you only turn it on …
1 Dec 2022
Gold or bitcoin: what will replace the US dollar?
Bitcoin & crypto

Gold or bitcoin: what will replace the US dollar?

As Russia and the West move further apart, there’s a growing need for a new global reserve currency. The US dollar could soon be replaced by gold or b…
6 Dec 2022
Radiator vs electric heater – which is cheaper?
Personal finance

Radiator vs electric heater – which is cheaper?

We compare the costs, pros and cons of radiators and electric heaters and see which one will help keep your energy bill as low as possible.
28 Nov 2022