Big Picture: Investors Not on the Defensive, Despite Talk of Recession
Author: Abhishek Ashok
September 26, 2023
Consumer staples, healthcare and utilities sectors have underperformed this year.
Source: AGF Investments as of August 31, 2023 using data from Factset. Relative returns are calculated as the difference between the performance return of each index noted above and the performance return of the S&P 500 Index. Past performance is not indicative of future results. One cannot invest directly in an index.
For all the talk of a looming recession, global equity investors don’t seem keen on protecting their portfolios—at least not in the traditional way.
In fact, three of the worst performing sectors of the U.S. stock market so far this year are the “defensive” trio of consumer staples, healthcare and utilities that historically offer earnings stability and the ability to weather weakening economic conditions.
Granted, the underperformance of each of these sectors has improved a bit of late—possibly because some cracks in the economy are starting to show. But rumblings of a recession aren’t the same as the reality of one taking hold and more evidence of a serious slowdown may be needed before investors choose to play defense more noticeably by allocating more of their holdings to consumer staples, healthcare and/or utilities stocks.
The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds, or investment strategies.
Commentary and data sourced from Bloomberg, Reuters and company reports unless otherwise noted. The commentaries contained herein are provided as a general source of information based on information available as of Sept 15, 2023 and are not intended to be comprehensive investment advice applicable to the circumstances of the individual. Every effort has been made to ensure accuracy in these commentaries at the time of publication, however, accuracy cannot be guaranteed. Market conditions may change and AGF Investments accepts no responsibility for individual investment decisions arising from the use or reliance on the information contained here.
This document may contain forward-looking information that reflects our current expectations or forecasts of future events. Forward-looking information is inherently subject to, among other things, risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed herein.
AGF Investments is a group of wholly owned subsidiaries of AGF Management Limited, a Canadian reporting issuer. The subsidiaries included in AGF Investments are AGF Investments Inc. (AGFI), AGF Investments America Inc. (AGFA), AGF Investments LLC (AGFUS) and AGF International Advisors Company Limited (AGFIA). AGFA and AGFUS are registered advisors in the U.S. AGFI is registered as a portfolio manager across Canadian securities commissions. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. The subsidiaries that form AGF Investments manage a variety of mandates comprised of equity, fixed income and balanced assets.
® The “AGF” logo is a registered trademark of AGF Management Limited and used under licence.
About AGF Management Limited
Founded in 1957, AGF Management Limited (AGF) is an independent and globally diverse asset management firm. Our companies deliver excellence in investing in the public and private markets through three business lines: AGF Investments, AGF Capital Partners and AGF Private Wealth.
AGF brings a disciplined approach, focused on incorporating sound, responsible and sustainable corporate practices. The firm’s collective investment expertise, driven by its fundamental, quantitative and private investing capabilities, extends globally to a wide range of clients, from financial advisors and their clients to high-net worth and institutional investors including pension plans, corporate plans, sovereign wealth funds, endowments and foundations.
Headquartered in Toronto, Canada, AGF has investment operations and client servicing teams on the ground in North America and Europe. AGF serves more than 800,000 investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B.
For further information, please visit AGF.com.
© 2025 AGF Management Limited. All rights reserved.
