Saturday, February 4, 2023

Use this strategy to find safe stocks

Hi

Many investors look for easy-to-apply strategies to help narrow down and simplify their stock selections. One super simple strategy is to find stocks with a low beta value.

Beta is a measure of how volatile a stock is compared to a particular index. In most cases this means the S&P 500. When a stock has a low beta (defined as being between 0 and 1), it will have smaller price swings than the index that it tracks.

During a bull market, low beta stocks can be boring. But in volatile markets, and particularly bear markets, boring can be beautiful. The goal of many investors is to avoid losing money.

In this special presentation, we’re giving you seven low beta stocks to consider when safety is your primary goal.

In many cases, low beta stocks are found in mature, defensive industries. This means that the companies have products and/or services that are in demand no matter what is happening in the broader economy. This helps ensure that the companies generate positive and, hopefully growing, revenue and earnings.

And, as this list of stocks confirms, many low beta stocks pay regular dividends. Receiving the benefit of regular income payments can be the difference in a stock outpacing inflation.

However, that doesn’t mean you shouldn’t expect to get a quality return. If you were to have invested in each of these stocks equally for the 12 months ending December 19, 2022 your portfolio would have a return of 35%. That number doesn’t include any dividends you could have reinvested which adds the benefit of compounding.



View the 7 Low Beta Stocks to Help You Weather Volatile Conditions

Rebecca McKeever
MarketBeat.com


 

 
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