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The Q.ai Team
April 25, 2023

About Q.ai's Recession Resistance Kit

About Q.ai's Recession Resistance Kit

Are we entering a recession or are we already in one? It’s up for debate and, frankly, we’re not here to waste time wondering. We just dropped an all-new Specialty Investment Kit, Recession Resistance, to keep your portfolio resilient, recession or no recession. 

With continued economic uncertainty, a weakening bank sector and high interest rates, many investors are looking to make more conservative money moves. And Recession Resistance allows you to do just that—in sectors that tend to perform well during economic downturns like healthcare, utilities and consumer staples. 

Here’s how this Kit could keep your portfolio afloat through rough waters.

Get through economic downturns with the Recession Resistance Kit

It’s no secret that we’re witnessing a lot of tough times economically. That’s why our investment team has kept a keen eye on the equity market’s performance, which has been largely rooted in strong forecasts for economic recovery based on the U.S. Federal Reserve relenting from its hiking approach.

While the Fed may be closer to ceasing its rate program, however, concerns surrounding a potential recession have long been ignored.

We believe the recent banking system stress we’re seeing both in the U.S. and overseas could lead to credit tightening and a real roll-over of economic data later this year. And that’s why we think investors need to be prepared.

We’re here to help you gear up with all the armor you need: artificial intelligence.

The AI in Recession Resistance works by adjusting holdings to various hedging assets that protect against forecasted downturns. Weekly updates to holdings will reflect these shifts and weather whatever storms hit.

Don’t worry, our AI looks into all available data, including pricing, options, news, social media sentiment, short interest and debt-to-cash ratios. This way, we miss nothing that could impact portfolio performance during a recession.

Invest in equities that tend to do well in recessions

Recession Resistance invests in companies and sectors that have solid cash flow and quality balance sheets. These companies tend to see less performance volatility than higher-valued companies. 

You might find companies like the following in Recession Resistance any given week:

  • Johnson & Johnson (JNJ): JNJ is a well-diversified healthcare company with a strong balance sheet, and it has a long history of steady performance through economic cycles. The company's products tend to be inelastic, meaning that demand for them remains relatively stable in a recession.
  • Duke Energy Corporation (DUK): DUK is a utility company that provides electricity, gas and other services to millions of customers in the U.S. Utilities tend to be defensive investments since they provide essential services, and demand for these services tends to remain stable in a recession.
  • Procter & Gamble Co (PG): PG is a consumer goods company that produces a wide range of products such as Tide laundry detergent, Pampers diapers, and Crest toothpaste. These products tend to be inelastic, meaning that they are consistently in demand regardless of the economic climate.
  • Newmont Corporation (NEM): NEM is a mining company that specializes in gold extraction. Gold is a traditional hedge against inflation and economic uncertainty, and demand for it tends to rise during recessions.

Diversify and strengthen

Some sectors tend to hold up pretty well in volatile times, so they can provide a solid source of diversification. People will always need healthcare, utilities and consumer staples, whichever which way the economy turns.

Note, however, that the expected upside of this Kit is relatively limited compared to other Kits. That’s because Recession Resistance is designed to prioritize resilience in a recession over high returns.

Bottom line

Want to keep investing and building wealth, despite a shaky economy? The Recession Resistance Kit offers diversified exposure to specific sectors that tend to survive economic downturns. So your portfolio can survive, too.

Q.ai is the trade name of Quantalytics Holdings, LLC. Q.ai, LLC is a wholly-owned subsidiary of Quantalytics Holdings, LLC ("Quantalytics"). Quantalytics offers automated financial advice tools through Quantalytics Investment Advisors, LLC ("QAI"), an SEC-registered investment advisor. QIA’s investment advisory services are ONLY available only to residents of the United States. Disclosures concerning QIA’s investment advisory services are available on its Form ADV filed with the SEC. The content in this newsletter is for informational purposes only and does not constitute a comprehensive description of Q.ai's investment advisory services.

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