Recession Resistant


DEFINITION of 'Recession Resistant'

An entity which is not greatly affected by a recession. Recession resistance can apply to stocks, companies, businesses, jobs and even entire industries that will be needed during all economic states. For example, an item such as bread may be considered recession resistant, as people will continue to buy bread regardless of a recession.

BREAKING DOWN 'Recession Resistant'

During times of recession, portfolio diversification plays an even larger role than normal. It is wise for investors, even in times of plenty, to have a wide variety of investments included in their portfolio to insure them no matter which way the economy turns. Types of stock that will provide insurance during a recession are called recession-resistant stocks.

  1. Recession

    A significant decline in activity across the economy, lasting ...
  2. Double-Dip Recession

    When gross domestic product (GDP) growth slides back to negative ...
  3. Slump

    A slang term denoting a period of poor performance or inactivity ...
  4. Stock Cycle

    The evolution of a stock's price from an early uptrend to a price ...
  5. Economic Cycle

    The natural fluctuation of the economy between periods of expansion ...
  6. Panic Selling

    Wide-scale selling of an investment, causing a sharp decline ...
Related Articles
  1. Economics

    Industries That Thrive On Recession

    Find out where to turn when looking to invest in a tumultuous market.
  2. Investing

    The Ups And Downs Of Investing In Cyclical Stocks

    This strategy can be profitable but only if you know when to dump these stocks.
  3. Budgeting

    5 Things You Shouldn't Do During A Recession

    These tips can help you avoid financial risk, and are especially important during an economic slowdown.
  4. Fundamental Analysis

    Where's The Market Headed Now?

    Whether up, down or sideways, learn about some of the factors that drive stock market moves.
  5. Mutual Funds & ETFs

    8 Fund Types To Use In A Recession

    When the economy blows up, these funds offer some protection from major losses.
  6. Active Trading Fundamentals

    Recession: What Does It Mean To Investors?

    Understanding the business cycle and your own investment style can help you cope with an economic decline.
  7. Savings

    7 Ways To Recession-Proof Your Life

    Find out what you can do to prepare and cope in tough economic times.
  8. Options & Futures

    Get Hired In Finance, Despite The Recession

    During a recession, there are still plenty of options for a business school graduate.
  9. Economics

    4 Tips For Buying Stocks In A Recession

    Bear markets can terrify even seasoned investors. Learn how to invest safely.
  10. Mutual Funds & ETFs

    Survival Tips For A Stormy Market

    Learn which stocks to watch and which to avoid when the Dow starts to sink.
  1. Why have mutual funds become so popular?

    Mutual funds have become an incredibly popular option for a wide variety of investors. This is primarily due to the automatic ... Read Full Answer >>
  2. What are the risks of annuities in a recession?

    Annuities come in several forms, the two most common being fixed annuities and variable annuities. During a recession, variable ... Read Full Answer >>
  3. Can mutual funds invest in private equity?

    Mutual funds can invest in private equity indirectly by buying shares of publicly listed private equity companies, such as ... Read Full Answer >>
  4. Can mutual funds invest in MLPs?

    Mutual funds invest in a wide variety of securities, including master limited partnerships, or MLPs. Because MLPs exhibit ... Read Full Answer >>
  5. Can mutual funds invest in REITs?

    Mutual funds invest in stocks and fixed-income securities, as well as various real estate investment trusts (REITs) formed ... Read Full Answer >>
  6. Are mutual funds considered liquid assets?

    Like your savings or checking account, any interest you own in a mutual fund is considered a liquid asset because it can ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Real Estate Investment Trust - REIT

    A REIT is a type of security that invests in real estate through property or mortgages and often trades on major exchanges ...
  2. Section 1231 Property

    A tax term relating to depreciable business property that has been held for over a year. Section 1231 property includes buildings, ...
  3. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
  4. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ...
  5. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  6. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!