Abbott Laboratories (ABT), The Chubb Corporation (CB), And Three Stocks That Offer Protection From Market Tantrums

Contender number two

The Kroger Co. (NYSE:KR) has a P/E of 12.5 and a forward P/E of 11.4; that’s lower than its peers in the grocery stores sector, which have an average P/E of 17.6. The company has a P/B ratio of 4.3 against the sector average of 10.6. Kroger appears to be undervalued when compared to the rest of the sector, and the company’s defensive nature means that is has a beta of around 0.4.

The Kroger Co. (NYSE:KR) has very little correlation to the market in general as its products and services are always in demand.

Contender number three

The Chubb Corporation (NYSE:CB) has a P/E of 14.2 and a forward P/E of 12.8, lower than that of its peers in the property and casualty insurance sector, which trade on an average P/E of 16.2. However, the company has a P/B ratio of 1.5 against the sector average of 1, making it look slightly overvalued. That said, the company’s defensive nature means that it has a very low correlation to market movements, resulting in a low beta of 0.5.

The Chubb Corporation (NYSE:CB) has risen steadily higher during the past five years with little correlation to market volatility, which gives it a low beta.

Conclusion

It is hard to beat the market, but it is easier to defend a portfolio against sudden market corrections. These three companies all offer a discount in relation to their peers and a low correlation to the rest of the market, both of which will help keep a portfolio steady in rough markets.

The article Three Stocks that Offer Protection from Market Tantrums originally appeared on Fool.com and is written by Rupert Hargreaves.

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