ChatGPT is growing its influence and capabilities apace, and it\u2019s often sought out for its advice pertaining to all things financial.<\/p>\n
And with some talk of recession, the major question analysts seem to be asking is \u201cWhen?\u201d It could be prudent to consult ChatGPT over the question of which investments<\/a> might best weather any possible coming market downturn<\/a>.<\/p>\n ChatGPT was quick to gesture toward three particular cornerstones of investment that should be able to withstand the macroeconomic turmoil common to recessionary periods: defensive sectors (\u201cstuff people can\u2019t really cut,\u201d according to the artificial intelligence, or AI, model), high-quality companies (\u201cbalance-sheet survivors\u201d), and bonds as well as defensive exchange-traded funds<\/a>, or ETFs (or \u201cboring ballast\u201d in its terms).<\/p>\n Let\u2019s examine each in brief, outlining its reasoning for each named category.<\/p>\n Read More: 3 Safest Investments To Hold In The Current Trump Economy<\/a><\/p>\n Find Out: 9 Low-Effort Ways To Make Passive Income (You Can Start This Week)<\/a><\/p>\n ChatGPT was quick to point to an August Morningstar report<\/a> suggesting that \u201chealthcare, utilities staples, and consumer stocks typically perform best during economic weakness.\u201d<\/p>\n \u201cIn plain English: people keep buying food, medication, electricity, and basic household items even when they\u2019re broke and cranky. Companies that sell those things often see smaller earnings hits and less-severe stock drawdowns,\u201d ChatGPT explained.<\/p>\n Speaking of several high-profile pieces of recent data points \u2014 notably, Goldman Sachs<\/a> \u2014 ChatGPT highlighted the value of cultivating a \u201chigh-quality\u201d basket of investments.<\/p>\n In Goldman Sachs\u2019 case, an extensive study of 2024\u2019s likely equity performers (from Nov. 2023) showed that its own quality basket (constituted by 50 different picks, from Alphabet to Tractor Supply to UnitedHealth Group and beyond) was outperformed by the S&P 500<\/a> (posting a 6% return versus 19%), but this was a valuable strategic hedge against volatility.<\/p>\n The same principle applies more broadly, per the AI\u2019s advice.<\/p>\n \u201cSo, if you\u2019re hunting for \u2018survivors,\u2019 you\u2019re not just looking for any old utility or grocery chain; you\u2019re looking for the ones with: low or manageable debt, durable, recurring cash flows, and a history of keeping dividends going (and ideally growing) through past slowdowns,\u201d ChatGPT suggested.<\/p>\n