What Stocks to Invest in During the Recession

Video Transcript

"No guts no glory, that's the way that we'll figure out what to buy during the bottoms of recessions. Hi I'm Roger Groh with Groh Asset Management, and we're here today to talk about, what do you buy during a recession. Well if you're a no guts no glory type of investor, probably the highest rates of returns will come from cyclical stocks, things that today nobody is buying during the bottom of a recession, but yet when things get good again at some point in the future, they'll be buying a ton of. What might that be? Well, pick up the paper. Nobody is buying housing, nobody is buying cars, nobody is getting car loans or auto loans, so the banks are awful, as examples of stocks and industry groups that are down terribly this year and probably will remain so until we begin to come out of this recession. Now everybody's risk portfolio is a little bit different. If you're elderly it may not be appropriate to do that sort of thing. If you're young it may be appropriate, but still it's very easy to lose money in those types of industries, and you need to have lengthy multiple conversations with your broker or investment professional about what you should buy. Be very careful. You don't know who's going to survive yet. In other words, you can buy a bank and find out that they're out of business in a year, you can buy a car maker and find out that they're out of business in a year, you can buy a steal company and find they go out of business, because you don't know yet who's going to survive, that's the risk. So it's no guts not glory. I'm Roger Groh, and thank you very much for spending a few minutes with me."