Defensive Stocks

[Captain G]

What gives these stocks their defensiveness? And can anyone give me some examples of defensive stocks and/or sectors, in case of a correction occurring?

[OzFrisky]

Hi I'm new to all this but defensive stocks are things that dont rely on discretionary spending arn't they ? Banks, Food, Household goods that sort of thing ?

[noirua]

What gives these stocks their defensiveness? And can anyone give me some examples of defensive stocks and/or sectors, in case of a correction occurring?

Defensive stocks are stocks that tend to provide the best relative performance during periods of extreme volatility or during adverse trends. Defensive stocks are chosen because of the stability they provide to a portfolio.

Normally, defensive stocks come from sectors that have a constant demand and have low beta vis-a-vis the market. Examples of defensive stock sectors are food and health care. Defensive stocks are opposite to the cyclical stocks, as they are not directly tied to the economic cycle.

[Knobby22]

Depends what you're defending against!

[Julia]

In a downturn or outright recession, counter-cyclical stocks like UTB do quite well. Presumably a combination of the comfort factor and the hope that the punter will actually win something.

Julia