How to position equity portfolios in case of economic slowdown?


Fears of a recession returned forcefully at the end of 2018, a reminder that what looks set to be the longest economic cycle in US history is drawing to a close. Recent fall of economic indicators everywhere (PMIs), long lasting trade tensions as well as political uncertainties push investors to prepare portfolios for a potential an economic slowdown. The probability of a recession in the US twelve months ahead has doubled according to Federal Reserve Banks of New York and is standing at 21%.

To help equity investors to protect their portfolio, Societe Generale Equity strategists have just published a comprehensive equity strategy special report titled Recession Survivor Kit.

After looking at what is currently priced in European equity market, they dig into the potential impact on performances, earnings and valuation, analysing historical pattern as well as highlighting new elements to take into account for each sector. In coordination with Societe Generale equity analysts, they come up with sectors and stocks to favor and the ones to avoid in case of an economic slowdown.

SG Cross-Asset Research is composed of more than 200xxx Analysts, Strategists, Economists and Quant, combining their expertise into ‘Research-based’ and innovative solutions suited to client’ needs: fundamental studies and expert views, investment ideas and long-term strategies, trade ideas and tactical baskets, thematic and systematic indices, quant solutions. On top of its established UK and Western European base, SG Cross-Asset Research benefits from a global coverage thanks to its presence in the US and in Asia (Hong Kong, Singapore, Tokyo and Bangalore) and Societe Generale local networks in Eastern Europe.


This editorial contains financial analysis which reflects the opinion of the Cross-Asset Research department of Societe Generale at the date of its publication. It does not necessarily reflect the views of the other departments of Societe Generale nor the official opinion of Societe Generale. This interview is dedicated to institutional and professional investors and is not deemed to be seen and used by retail investors for investment purpose. The viewers shall consult their own financial advisers to make their own appraisal.