Analysis of Google Trends suggests that searches for recession stocks have spiked in the past 30 days as many people look to find safe-haven stocks.
A new analysis by the financial information website Safetradebinaryoptions finds that—even with the bear market surrounding us—there are still some stocks that people can look for.
The author at Safetradebinaryoptions, Saqib Iqbal, commented on the findings:
"Although we aren't in a recession, we are in an economic downturn, which creates uncertainty in the market. When there is so much market uncertainty and volatility, investors seek to get out, regardless of how well their stocks are doing. However, some stocks perform better in an economic downturn; you just have to look for specific sectors."
Following the booming bull market of 2021, 2022 has been a particularly unpleasant year for investors.
Nearly all major indices and many individual stocks are down by double digits this year, making many investors cautious of putting additional money into an already bearish stock market.
According to a Bankrate survey from May 2022, 56% of US investors reported they have purposefully avoided making investments due to stock market volatility.
With inflation continuing and markets falling, investors may be even more hesitant to put their money to work.
So, what can you do in this situation?
You can look for stocks that perform well when the economy goes south.
During an economic downturn, many investors are unsure where to place their investment capital.
You just need to look for businesses in recession-proof industries, such as defense, for example.
Here are some other sectors that tend to perform better in a bear market.
If we dig deeper, here are some specific stocks that are currently performing well:
Biogen (+10.42% YTD)
Exxon Mobil Corp (+59.68% YTD)
Coterra Energy (+46.76%)
EQT Corp. (+87.40%)
McKesson Corp (+43.27%)
Clearly, some stocks are performing well in the current economic conditions.
Now that you know some of the best-performing stocks, here are a few steps you can take in today's uncertain environment.
Most important is to keep in mind that you are in this for the long run.
To protect yourself, you may want to change your portfolio allocations to invest more in risk-free stocks.
If you are the type of person who panics when the market falls, you shouldn’t invest at all.
The good news is that just because the stock market is down doesn't indicate that every business is in trouble. The bad news is we don't always know if particular sectors will perform well.
Nobody can forecast the future of the stock market. In the end, we're all trying to do this. Remember that a recession or economic downturn does not continue forever; historically, the economy has always bounced back.