Anytime a bull market gets this long in the tooth it’s a smart idea to pepper your portfolio with “all-weather” names that can keep growing for whatever duration is left in the rally, but that are also poised to at least hold their own when the inevitable turn to bear occurs.
“The end of a bull market the rally gets really narrow,” says Paul Schatz of Heritage Capital. “Very few stocks lead and the ones that lead go vertical.” Schatz is less interested in those and stopped by Yahoo Finance with his picks for the less dazzling, and more practical names, that could help shield you from the big bad bear.
Cedar Fair (FUN) - This amusement park operator is low risk, Schatz says. Given that most of its parks are shuttered for the winter don’t expect a lot of action or much volatility. “It’s a limited partnership,” he notes, “it pays a very good dividend yield." Right now that yield is 6.4%. Schatz also points out that "earnings are growing. It’s a good solid company, good core holding for a safer all-weather portfolio.”
Novartis (NVS) - Schatz likes big pharma “at the end of a bull market because I think when we transition to a bear market, large cap pharma will hold up well.” He says Novartis in particular is a solid bet thanks to earnings growth and again, that solid dividend yield of 2.9%. “To me that’s kind of the best car in a great race.”
Energy Transfer Partners (ETP) - This midstream energy play is mainly in the natural gas business but has dipped its toe into oil. Don’t be afraid of the plummeting price of black gold Schatz says. The company’s natural gas involvement has shielded them from much of the volatility that has come about thanks to falling crude prices.
Still, Schatz understands getting into energy right now has some more than a little nervous. “Oil is not going to zero,” he reassured. “Oil will find a bottom at some point between here and $20 lower. It will probably base for a while...but conspiracy theorists aside oil’s gonna be around. He even thinks it bounces back up to the $85-90 range before too long.