2 Investments to Help Hedge Against a Potential Recession

Aggravated by the recent banking failures and associated recessionary risks, market volatility is anticipated to remain anchored for quite some time. Therefore, investors might delve into some quality ETFs iShares Core S&P Mid-Cap ETF (IJH) and Vanguard High Dividend Yield ETF (VYM) for 2023 to diversify their portfolio.

Macroeconomic headwinds and the recent regional banking collapses have weighed heavily on investor sentiments. The current economic scenario has raised fears of an impending recession.

The chief economist at Wells Fargo, Jay Bryson, discussing the banking sector chaos, commented, “There will be real and lasting economic repercussions from this, even if all the dust settles well.” He added, “I would raise the probability of a recession given what’s happened in the last week.”

Also, Goldman Sachs (GSslashed the 2023 Gross Domestic Product (GDP) forecast by 0.3 percentage points to 1.2% and raised its recession probability from 25% to 35%. Furthermore, the chief economist of Apollo Global Management, Torsten Slok, said he is bracing for a hard landing given the present crisis.

As market volatilities and recessionary fears are not likely to ease anytime soon, it might be wise to diversify one’s portfolio through quality ETFs. Hence…

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