I saw an article recently saying that safety stocks were leading the way higher. I might believe in Santa Claus, but I don’t believe in safety stocks.
There are no such things as safety stocks. There may be stocks that are less volatile than the market or go up and down less than the market, and they will say they have a beta less than one. That does not mean that they are safe, in any normal use of the word.
When someone says, “Oh this stock is safe,” that just doesn’t exist. There are plenty of examples of supposedly safe stocks going to zero or getting hammered in the marketplace. Two prime examples from this year are JNJ and GE.
So yes, there may be safer stocks, though maybe not if even JNJ and GE are vulnerable. But there’s no such thing as safe stocks or safety stocks, so don’t believe anyone that tells you that there is. Believe in the big guy in the red suit though. He’s real.
Mike Garry, Yardley Wealth Management. We are a fiduciary, fee-only financial planning, and wealth management firm in Newtown, Pennsylvania. That’s in Bucks County. If you’d like to talk about this or anything else, please reach out: 267-573-1019, email@example.com or @michaeljgarry