Despite the recession, be ready to profit with these 2 stocks.
What is bad for most can be heaven for some. With the recession at your door step, be ready to profit with these two stocks.
Some industries rely on things that you can´t live without. Food, health care, essential technology. Some areas are just deemed continue cashing in.
Here are two stocks that will not only continue growing with the recession, but will profit from it.
What are Consumer Staples?
Consumer staples are essential products that people are unable, or not willing to cut out of their budgets, regardless of their financial situation.
Consumer staple stocks are non-cyclical because they produce or sell goods or services that are always in demand.
People tend to demand consumer staples at a relatively constant level, regardless of their price, making consumer staples stock attractive during recessions
Walmart – as essential as ever
Not even the COVID-19 shutdowns were able to hold this recession-proof beast.
Despite a drop in March when the SP500 crashed, Walmart stocks quickly bounced back and it´s now up 11% on the year.
While small shops and weak chains struggle, Walmart earnings have kept growing pushed by it´s e-commerce platform.
Basic consumption during pandemic times
Investing in consumer staples stocks during the pandemic makes perfect sense. As much as the crisis is real, people still have basic needs to be fullfilled.
Unlike other economic crisis, the COVID-19 pandemic has forced people to stay at home and avoid social contact.
As a result, online shopping and contact-less payments flourished, bringing profits to credit card companies and online retailers.
Mastercard – you spend, they earn
It has been 9 years since this giant payment company has had an year with negative stock returns.
Every year since 2011 the company has been in the positive territory. And this year it has not been different so far.
With the world moving to electronic payments, purchasing volumes tend to continue rising.
Portfolio allocation and risk taking
With so much changing in the world it is clear that the world order will change after the pandemic.