{"id":299572,"date":"2010-02-09T12:04:18","date_gmt":"2010-02-09T17:04:18","guid":{"rendered":"http:\/\/www.businessinsider.com\/rosenbergs-five-ways-to-protect-your-portfolio-during-a-deflationary-period-2010-2"},"modified":"2010-02-09T12:04:18","modified_gmt":"2010-02-09T17:04:18","slug":"rosenbergs-five-ways-to-protect-your-portfolio-during-a-deflationary-period","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/299572","title":{"rendered":"Rosenberg’s Five Ways To Protect Your Portfolio During A Deflationary Period"},"content":{"rendered":"

\"david<\/p>\n

In this morning’s Breakfast With Dave, analyst David Rosenberg<\/a> discusses the various strategies that you, the investor, can use to hedge against losses during a period of delfation<\/a>. When commodity prices are falling and the dollar is dropping, here’s how you protect yourself:<\/p>\n

—–<\/p>\n

1. A focus on safe yield, wherever you can get it<\/strong>. High-quality corporates (non-cyclical, high cash reserves, minimal refinancing needs)<\/p>\n

2. Equities<\/strong>: focus on reliable dividend growth\/yield; preferred shares (“income” orientation).<\/p>\n

3. Whether it be credit or equities, focus on companies with low debt\/equity ratios and high liquid asset ratios<\/strong> – balance sheet quality is even more important than usual. Avoid highly leveraged companies at all costs.<\/p>\n

4. Ultra-selectivity with regard to financials<\/strong>. Same for retailing.<\/p>\n

5. Focus on sectors or companies with these micro characteristics<\/strong>: low fixed costs, high variable cost, high barriers to entry\/some sort of oligopolistic features, a relatively high level of demand inelasticity (utilities, staples, health care).<\/p>\n

Join the conversation about this story »<\/a><\/p>\n

See Also:<\/b><\/p>\n