The market is skating on thin ice, with one misstep potentially sending it into a correction. The S&P 500’s reliance on AI euphoria has led to macro landmines lurking beneath the surface. A 20% correction is plausible as investors await commentary on tariff negotiations and their impact on sales growth.
However, it’s not all doom and gloom. By identifying sectors that provide resilience, income, stability, and low volatility, investors can allocate a portion of their portfolio accordingly. Here are four stocks to consider:
1. American Electric Power (AEP): With exposure to nuclear and clean baseload power, utilities like AEP are poised for growth.
2. General Dynamics (GD): Consistent defense revenue and business jet exposure make GD an attractive option during times of global tension.
3. Deckers Outdoor (DECK): Strong company survival is key, with DECK offering growth, a strong balance sheet, and brand pricing power at an attractive price-to-earnings multiple.
4. Waste Management (WM): Sustainability services, landfill gas, and pricing power make WM a low-volatility beast with monopolistic qualities.
Trefis High-Quality Portfolio has outperformed the S&P 500 over the last four years by allocating money based on market dynamics. By adopting a rules-based approach to wealth management, investors can navigate market uncertainty and achieve better returns with less risk.
Source: https://www.forbes.com/sites/greatspeculations/2025/04/22/sp-to-crash-20-next-month