Defensive Stocks: Valuation, Moats & Downside Protection

How can you protect your portfolio when markets fall? Explore defensive stocks, investment trusts and diversification strategies for managing inflation, AI concentration risk and market uncertainty. In this episode of QuotedData’s In The HotSeat, host Gavin Lumsden asks how investors can preserve capital and purchasing power while retaining opportunities for long-term growth. SPEAKERS AND KEY TAKEAWAYS The following summarise the speakers’ views in this interview. Timestamps identify where each takeaway is discussed. Alan Bartlett | Goodhart Partners; co-manager of Global Opportunities Trust - Explains how flexible stock selection, cash, bonds and index hedging can support an absolute-return approach, rather than tracking an index (14:52). - Discusses portfolio correlation, business resilience and valuation, with examples including Magyar Telekom and Rheinmetall (38:34). - Argues that preserving capital during a downturn can put investors in a stronger position to exploit subsequent opportunities (54:41). More about Alan Bartlett at Goodhart Partners: (https://www.goodhartpartners.com/team/alan-bartlett) Jeremy McKeown | Dowgate Wealth; Head of Asset Allocation for The Investment Company - Sets out an alternative to the traditional 60/40 portfolio, combining quality equities with scarce assets, including gold and Bitcoin exposure, aimed at preserving purchasing power (17:28; 18:59). - Explains his concerns about government debt, currency debasement and the implications for long-term investors (33:48). - Describes stock-selection criteria including barriers to entry, hard-to-replicate assets, share buybacks and valuation below replacement cost (45:30). More about Jeremy McKeown at The Investment Company:(https://theinvestmentcompanyplc.co.uk/team/jeremy-mckeown/) Nick Britton | Association of Investment Companies (AIC), Research and Content Director - Explains why trusts in the Flexible Investment sector can have very different strategies and should be assessed individually (20:27). - Discusses investment trusts’ exposure to US technology stocks and opportunities to diversify beyond concentrated global indices (29:11). - Highlights equity income, access to private assets and the closed-ended structure as considerations for investors seeking diversification (52:36; 59:15). More about Nick Britton at the Association of Investment Companies:(https://www.theaic.co.uk/financial-advisers/people/nick-britton) Richard Williams | QuotedData, Senior Analyst - Explains how Oakley Capital Investments’ asset sales can provide evidence for portfolio valuations, reduce funding commitments and support buybacks (06:45; 10:23). Gavin Lumsden | QuotedData, Head of News and host - Leads the investment trust news review and examines whether defensive investing can balance downside protection with growth, including the case for global index trackers (00:14; 48:46; 56:00). More about the QuotedData team: (https://quoteddata.com/about-quoteddata/who-are-we/) CHAPTERS 00:00 Welcome and investment trust news 02:39 Results, performance and tender offers 05:04 Asset sales, valuations and buybacks 06:45 Oakley Capital Investments: Richard Williams 12:52 Defensive investing panel: meet the speakers 14:23 Global Opportunities Trust’s absolute-return approach 16:59 The Investment Company: preserving purchasing power 20:04 What is the Flexible Investment sector? 22:06 AI bubble risks and stock market concentration 28:48 Investment trusts’ exposure to US technology 31:05 Inflation, geopolitics and diversification 33:29 Currency debasement, gold and scarce assets 38:00 Defensive stocks: valuation, resilience and correlation 44:33 Amazon, business moats and stock-selection criteria 48:46 Audience Q&A: downside protection and opportunities 52:20 Investment trust discounts and equity income 54:12 When should defensive investors take more risk? 56:00 Why not simply buy a global index ETF? 58:55 Investment trusts, diversification and private markets 1:01:17 Closing remarks Subscribe to QuotedData for investment trust research, market news and In The HotSeat interviews with audience Q&A. What does a defensive portfolio look like to you? Share your thoughts in the comments. #DefensiveInvesting #InvestmentTrusts #PortfolioDiversification Visit QuotedData.com: http://www.quoteddata.com For QuotedData Events visit: http://www.quoteddata.com/events For QuotedData News visit: http://www.quoteddata.com/news QuotedData on Socials: On Twitter: https://twitter.com/quoteddata On Facebook: https://www.facebook.com/QuotedData On LinkedIn: https://www.linkedin.com/company/5378740 On TikTok: https://www.tiktok.com/@quoted_data On Instagram: https://www.instagram.com/quoted_data/