Defensive Investing - A Guide to Safe Investments

What is Defensive Investing? And, can you create a portfolio that will keep you safer than the general market? This defensive investing guide looks specifically at Defensive Investing and whether it works.

Investing defensively means focusing on safety and stability over high risk and reward. This means prioritizing investments in sectors that are less affected by market fluctuations, economic downturns, and other external factors.

This defensive investing guide will give you the tools to build a safe portfolio by mixing a range of different and uncorrelated assets, investors can build a defensive portfolio while still potentially maintaining much better returns than having your cash under the mattress or at a bank (which is basically the same thing these days).

Some of the most common defensive investment strategies include investing in stable dividend-paying stocks, bonds, and other fixed-income securities. Also investing in sectors that are less affected by market fluctuations, such as healthcare, consumer staples, utilities, and real estate investment trusts (REITs).

With this said, it’s important to build your portfolio according to your individual appetite for risk. Investing should be seen as a long-term strategy. Therefore sitting through a short-term decline, knowing that your investments will recover and grow significantly more than having the funds in cash is important to remember.