People can have surprisingly short memories. Defensive equities have lagged the market recently and even in some short-term corrections in particular, leading some investors to question their place in an equity allocation. It may be tempting to view it as a cyclical asset class meant for timing bear markets.
But a broader perspective reveals that it shows surprisingly good long-term results across most markets in addition to delivering during the most severe drawdowns, when it’s needed most – making it a valuable diversifier over a full market cycle.
Our latest paper explains: