In this article, we will take a look at the 12 best low-risk investments in April 2024. To skip our analysis of the recent market trends and market activity, you can go directly to see the 5 Best Low-Risk Investments in April 2024.
The stock market in 2024 presents a stark contrast to the landscape investors encountered at the onset of the coronavirus pandemic and in its immediate aftermath. Pre-pandemic, global stocks exhibited robust performance, fueling speculation that America’s reign as a global economic powerhouse might be waning, with emerging players like China poised to challenge U.S. dominance. More prevalently,
inflation continued to rise in February, maintaining the Federal Reserve’s trajectory to delay any interest rate cuts until at least the summer.
In addition, a string of concerning developments began on March 11 with a New York Federal Reserve survey revealing an acceleration in consumer expectations over the longer term in February, with additional reports showing a 3.2% year-over-year increase in consumer prices. Finally, on March 14, concerns heightened further with the release of data indicating rising pipeline pressures at the wholesale level. The U.S. Bureau of Labor Statistics report added to the inflation worries, revealing a 0.6% increase in the producer price index for February, double the Dow Jones estimate.
However, given the American economy’s continued outperformance compared to global peers, the Federal Reserve has greater flexibility to maintain higher rates. This strategy aims to temper Wall Street’s reliance on easy money, a trend that emerged following the 2008 Great Recession and the recent coronavirus pandemic. In February 2024, the flagship Wall Street stock index, comprising the pinnacle of the American stock market, reached a milestone by surpassing 5,000 points for the first time. This marks a significant departure from late 2022 when widespread speculation suggested an impending recession, prompting cautious preparations from investors.
That said, committed long-term investors tend not to focus too much on sudden changes like these. Rather than being swayed by rapid changes and uncertainties, they opt to invest in shares of reliable companies known for their consistent performance, assessed over extended periods often spanning years or even decades. While the allure of investing in entirely risk-free stocks may be enticing, the reality is that no stock can guarantee 100% safety. However, it’s worth noting that certain stocks, including names like Costco Wholesale Corporation (NASDAQ:COST), Walmart Inc. (NYSE:WMT), and Berkshire Hathaway Inc. (NYSE:BRK-B), are notably more secure than others, thus making them some of the best low-risk investments out these.
A close-up of a computer monitor displaying real-time financial data on the stock market.
Our Methodology
Our process for shortlisting stocks for April 2024 involved several criteria: we looked for stocks with a beta value of less than 1.0, strong fundamentals, positive analyst ratings, and positive analyst price targets as of March 27. We then narrowed down our selection by excluding midcap or lower companies and stocks lacking stable and resilient dividend payouts. The remaining stocks were evaluated using Insider Monkey’s database of elite hedge funds tracked as of the fourth quarter of 2023. The top 12 stocks based on hedge fund sentiment, ranked in ascending order of hedge fund shareholders, have been included on our list.
Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). That’s why we pay very close attention to this often-ignored indicator.
12. General Mills, Inc. (NYSE:GIS)
Number of Hedge Fund Holders: 40
Beta Value: 0.14
General Mills, Inc. (NYSE:GIS) is a prominent American multinational company renowned for its production and marketing of branded processed consumer foods, widely distributed through retail channels. The company’s origins can be traced back to its establishment near Saint Anthony Falls in Minneapolis, along the Mississippi River, where it initially gained prominence as a significant flour milling operation.
As of the end of Q4 2023, Insider Monkey’s database indicated that 40 hedge fund investors had allocated their investments to General Mills, Inc. (NYSE:GIS). The largest shareholder of General Mills, Inc. (NYSE:GIS) was John Overdeck And David Siegel’s Two Sigma Advisors, holding approximately 3.48 million shares valued at about $226.99 million.
Much like Costco Wholesale Corporation (NASDAQ:COST), Walmart Inc. (NYSE:WMT), and Berkshire Hathaway Inc. (NYSE:BRK-B), General Mills, Inc. (NYSE:GIS) is one of the best low-risk investments in April 2024.
11. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 54
Beta Value: 0.41
Colgate-Palmolive Company (NYSE:CL) is a multinational corporation headquartered in Midtown Manhattan, New York City, situated on Park Avenue. The company specializes in manufacturing, distributing, and providing a diverse array of household, healthcare, personal care, and veterinary products.
With a dividend growth streak extending over 61 years, CL stands out as one of the premier low-risk investments in the market. Presently, it offers a quarterly dividend of $0.50 per share, boasting a dividend yield of 2.22% as recorded on March 27.
As of the close of Q4 2023, 54 hedge funds tracked by Insider Monkey reported having stakes in Colgate-Palmolive Company (NYSE:CL), up from 52 in the previous quarter. These stakes are worth nearly $3 billion in total. First Eagle Investment Management owned roughly 11 million CL shares, becoming the company’s leading stakeholder in Q4.
10. Costco Wholesale Corporation (NASDAQ:COST)
Number of Hedge Fund Holders: 57
Beta Value: 0.77
Costco Wholesale Corporation (NASDAQ:COST) operates a global network of membership warehouses, primarily under the “Costco Wholesale” brand, offering high-quality, brand-name products at significantly lower prices compared to traditional wholesale or retail outlets.
As of March 27, Costco Wholesale Corporation (NASDAQ:COST) offers a quarterly dividend of $1.02 per share, resulting in a dividend yield of 0.56%. The company has demonstrated a consistent commitment to rewarding shareholders by increasing its dividend for the past 19 years.
According to data from Insider Monkey, Costco Wholesale Corporation (NASDAQ:COST) was included in 57 hedge fund portfolios at the end of Q4 2023, compared with 65 in the previous quarter. The stakes held by these hedge funds have a combined value of over $4 billion.
9. The Coca-Cola Company (NYSE:KO)
Number of Hedge Fund Holders: 62
Beta Value: 0.59
Widely recognized as one of the best low-risk investments, The Coca-Cola Company (NYSE:KO) stands as a renowned multinational American corporation renowned for its production of the iconic beverage, Coca-Cola. Beyond its flagship product, the company actively participates in the manufacturing, distribution, and promotion of a diverse range of non-alcoholic beverage concentrates, syrups, and notably, alcoholic beverages within the beverage industry.
On December 13, investment advisory firm Citi maintained a Buy rating on The Coca-Cola Company (NYSE:KO) stock and raised the price target to $67 from $65.
As of the end of the fourth quarter of 2023, 62 hedge funds had stakes in Coca-Cola Co (NYSE:KO).
Hayden Capital made the following comment about The Coca-Cola Company (NYSE:KO) in its third 2023 investor letter:
“It’s not just emerging markets either, where one could argue a “scarcity premium” given fewer quality public companies. Even in the US, The Coca-Cola Company (NYSE:KO) trades at ~30x P/E despite having the same earnings as 10 years ago.
Both of these companies actually have lower revenues than 10 – 15 years ago too, indicating that their profit growth is mostly from margin expansion. This can only last for so long before there’s no more excess expenses left to cut.
I find it ironic that all these companies trade as “bond-equivalents” in the minds of investors – even commanding lower yields than US treasuries, the safest security in the world. But it’s clear that their businesses are not nearly as safe. Coca-Cola is facing disruption risk from consumers shifting to new, heathier beverage brands.
But these companies are ~35% more expensive than US Treasuries, despite the heightened risk. On a risk-adjusted basis, one could argue the implied premium is even higher.”
Perhaps the explanation is simply the price volatility difference between these stocks and treasuries over the last two years. For example, 10-year Treasury bonds are down ~-20% since the beginning of 2022. By comparison, KO and PG are remarkably down only -4 – 6% over that time frame.”
8. PepsiCo, Inc. (NASDAQ:PEP)
Number of Hedge Fund Holders: 64
Beta Value: 0.53
Headquartered in Purchase, Harrison, New York, PepsiCo, Inc. (NASDAQ:PEP) stands as a leading American multinational corporation operating in the food, snack, and beverage sector. Renowned for its financial resilience, the beverage giant has maintained a consistent pattern of dividend growth for over 51 years. Presently, it offers a quarterly dividend of $1.27 per share, translating to a dividend yield of 2.89% as of March 27.
According to Insider Monkey’s database of Q4 2023, 64 hedge funds reported holding stakes in PepsiCo, Inc. (NASDAQ:PEP), compared with 65 in the preceding quarter. These stakes have a combined value of nearly $4.55 billion.
Along with Costco Wholesale Corporation (NASDAQ:COST), Walmart Inc. (NYSE:WMT), and Berkshire Hathaway Inc. (NYSE:BRK-B), PepsiCo, Inc. (NASDAQ:PEP) is a top low-risk investments in April 2024.
7. CVS Health Corporation (NYSE:CVS)
Number of Hedge Fund Holders: 67
Beta Value: 0.50
CVS Health Corporation (NYSE:CVS) is a prominent healthcare entity with an extensive network of retail pharmacies and clinics across the nation. Operating under various brands, including CVS Pharmacy (a retail pharmacy chain), CVS Caremark (a pharmacy benefits manager), and Aetna (a health insurance provider), the organization plays a crucial role in the healthcare industry.
In the fourth quarter alone, CVS Health Corporation (NYSE:CVS) announced total revenues of $93.8 billion, representing a notable 11.9% increase from the previous year. The net income for the quarter amounted to $2 billion. Additionally, the company experienced a substantial 72.8% surge in operating income for the fiscal year 2023.
As of the conclusion of the fourth quarter in 2023, data from Insider Monkey’s database, which monitors 933 hedge funds, indicated that 67 hedge funds held positions in CVS Health Corporation (NYSE:CVS). Notably, Marshall Wace LLP, led by Paul Marshall and Ian Wace, emerged as a significant investor with a substantial stake in the company valued at $382.67 million.
6. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 71
Beta Value: 0.43
Established in 1837 by William Procter and James Gamble, The Procter & Gamble Company (NYSE:PG) stands as a global consumer goods corporation headquartered in Cincinnati, Ohio. Renowned for its extensive range of branded consumer packaged goods, the company distributes its products globally across segments that include Beauty, Grooming, Health Care, Fabric & Home Care, and Baby, Feminine & Family Care. Presently, The Procter & Gamble Company (NYSE:PG) offers a quarterly dividend of $0.94 per share, equating to a yield of 2.32% as of March 27.
According to Insider Monkey’s database of Q4 2023, 71 hedge funds in Insider Monkey’s database reported having stakes in The Procter & Gamble Company (NYSE:PG), compared with 75 in the previous quarter. The total value of these stakes is roughly $6 billion. With over 10.5 million shares, Fisher Asset Management was the company’s leading stakeholder in Q4.
The Procter & Gamble Company (NYSE:PG) joins the ranks of Costco Wholesale Corporation (NASDAQ:COST), Walmart Inc. (NYSE:WMT), and Berkshire Hathaway Inc. (NYSE:BRK-B) as one of the best low-risk investments in April 2024.
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Disclosure. None. 12 Best Low-Risk Investments in April 2024 is originally published on Insider Monkey.