Home Logon FTA Investment Managers Blog Subscribe About Us Contact Us

Search by Ticker, Keyword or CUSIP       
Blog Home
Bob Carey
Chief Market Strategist
X •  LinkedIn

  How The S&P 500’s Defensive-Oriented Sectors Have Fared
Posted Under: Conceptual Investing
Supporting Image for Blog Post

View from the Observation Deck  
  1. While some lists may vary, the three sectors generally cited as being defensive-oriented with respect to the economy and/or stock market are consumer staples, health care and utilities. 
  2. These types of companies tend to distribute consistent dividends and act more stable during various phases of the business cycle because there tends to be reliable demand for their goods and services. 
  3. With respect to just the three sectors, Health Care outperformed Consumer Staples and Utilities in all six of the time periods featured in the chart above.  
  4. The total returns through 7/30/21 were as follows (Consumer Staples vs. Health Care vs. Utilities vs. S&P 500): 15-year avg. annual (10.48% vs. 12.07% vs. 8.56% vs. 10.85%); 10-year avg. annual (11.92% vs. 16.66% vs. 11.12% vs. 15.33%); 5-year avg. annual (8.73% vs. 14.04% vs. 8.46% vs. 17.33%); 3-year avg. annual (13.58% vs. 16.40% vs. 11.38% vs. 18.16%); 1-year (18.20% vs. 27.33% vs. 12.03% vs. 36.45%); and year-to-date (7.70% vs. 17.33% vs. 6.82% vs. 17.99%). 
  5. As of 8/4/21, their respective weightings in the S&P 500 Index were as follows: 13.56% (Health Care); 5.78% (Consumer Staples); and 2.51% (Utilities), according to Bloomberg. Combined, they account for a little more than one-fifth (21.85%) of the index. 
  6. As of 6/30/21, total mutual fund and exchange-traded fund net assets under management in these areas were as follows: $250 billion (Health); $39 billion (Utilities); and $23 billion (Consumer Defense), according to Morningstar. 
This chart is for illustrative purposes only and not indicative of any actual investment. The illustration excludes the effects of taxes and brokerage commissions or other expenses incurred when investing. Investors cannot invest directly in an index. The S&P 500 Index is an unmanaged index of 500 stocks used to measure large-cap U.S. stock market performance. The respective S&P 500 Sector Indices are capitalization-weighted and comprised of S&P 500 constituents representing a specific sector.

Download a PDF of this post, please click here.
Posted on Thursday, August 5, 2021 @ 11:40 AM • Post Link Print this post Printer Friendly

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.
Search Posts
Market Commentary and Analysis
Market Commentary Video
Monthly Talking Points
Quarterly Newsletter
Market Observations
Subscribe To Receive Email

One Measure Of Corporate Cash Holdings
A Snapshot Of Bond Valuations
A Snapshot Of Equity Fund Flows
Every Year Looks Volatile Compared To 2017
Passive vs. Active Fund Flows
Top-Performing S&P 500 Index Subsectors Since 12/14/20
For Those Equity Investors Concerned About Valuation Levels
A Global Snapshot Of Equity Returns Spanning The COVID-19 Pandemic
A Snapshot Of Growth vs. Value Investing (Small-Caps)
The Only Constant Is Change
Skip Navigation Links.
Search by Topic
Skip Navigation Links.

The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
Follow First Trust:  
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2024 All rights reserved.