Defensive securities

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Defensive securities

Low-risk stocks or bonds that will provide a predictable and safe return on an investor's money.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Defensive Securities

Low-risk securities, especially stocks in companies relatively unaffected by business cycles. In times of market downturn, investors tend to seek defensive securities to provide a steady rate of return, or at least to lose less money than the market as a whole. Examples include stocks in utility companies and the health care industry.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
Following the initial scramble in morning trading, markets were reassured by statements from policymakers, and investors stepped in to pick up shares of blue-chip dividend-paying, defensive companies such as GlaxosmithKline and AstraZeneca
Away from cyclical assets, defensive companies in the pharmaceutical and utilities sectors were both doing well.
SHARE TIPS Sunday Telegraph says shares in defensive companies such as Morrisons are likely to come back into fashion as global stock markets turn to "risk-off" mode.
Equities: Cheap stocks that pay high and sustainable dividends, quality companies with leading positions in their respective industries, and defensive companies with globally diverse revenues and exposure to emerging markets.
In 2011, political upheaval and global economic uncertainty benefited the defensive companies in our portfolio, Jarir Marketing and Saudia Dairy and Food Company (Sadafco) which were in our top five holdings increased by 39 per cent and 10 per cent respectively.While many petrochemicals saw their share price decline between five and 10 per cent in 2011, National Industrial Company (Tasnee), one of our top picks for the year, increased by 28 per cent in 2011.
When this man uses phrases like "career-defining opportunities" in UK stocks and "ludicrously cheap valuations" of his preferred defensive companies we should sit up and listen.
But as one of the UK's best defensive companies, its shares are well worth buying as the threat of a serious slowdown still hangs over the economy.
Whichever way you decide to broaden the scope of a portfolio, one particular investment strategy which has been in vogue over recent years and will likely remain that way until there is further clarity in equity markets is investing in the shares of defensive companies.
In the past, investment managers would be limited to re-balancing an equity portfolio towards the established defensive companies such as utilities.
Defensive companies fared better, with shares in utilities companies such as International Power and National Grid losing less value.
SUNDAY TELEGRAPH Imperial Tobacco's full-year results last week were reassuring, although they showed that even defensive companies such as tobacco firms have been feeling the pinch since the recession.