Why You Should Stay Away From These 3 Stocks Even as They Rally During the Market's Swoon
The Nasdaq Composite's (NASDAQINDEX: ^IXIC) drop into correction territory got investors worried. The S&P 500's (SNPINDEX: ^GSPC) fall to correction levels this week seems to have confirmed their concerns. Under such conditions, what is an investor to do?Many will move money into sectors they view to be less risky, such as consumer staples. However, while there are good reasons to see consumer staples companies as defensive picks, not all such stocks are worth buying. Here are three you should probably avoid now, including one with a tempting 10% dividend yield.Consumer staples makers sell things people buy regularly because they are, almost by definition, necessities. In most cases, these products are also fairly cheap relative to their benefits. You may put off buying a new car when the economy gets rough, but you probably won't cut back too far on food, beverages, or toiletries.Continue reading
The Nasdaq Composite's (NASDAQINDEX: ^IXIC) drop into correction territory got investors worried. The S&P 500's (SNPINDEX: ^GSPC) fall to correction levels this week seems to have confirmed their concerns. Under such conditions, what is an investor to do?
Many will move money into sectors they view to be less risky, such as consumer staples. However, while there are good reasons to see consumer staples companies as defensive picks, not all such stocks are worth buying. Here are three you should probably avoid now, including one with a tempting 10% dividend yield.
Consumer staples makers sell things people buy regularly because they are, almost by definition, necessities. In most cases, these products are also fairly cheap relative to their benefits. You may put off buying a new car when the economy gets rough, but you probably won't cut back too far on food, beverages, or toiletries.
