Three Sectors for the Recovery

These areas -- and funds that focus on them -- should do well when the recession ends. Plus, two sectors to weather the downturn.

The U.S. economy may be in a recession, but the stock market is already looking ahead to better days. Now is a good time to position your portfolio for the recovery and bull market that are sure to come.

We don't know when the economy will turn the corner, but we have a pretty good idea of what types of investments will do well when it does. Banks and other financial-services firms, for example, tend to prosper, thanks to low interest rates and renewed demand for credit. Small-company stocks have also performed well historically. Knowing which types of stocks do well at any given stage in the business cycle will help you buy good funds before the sectors they reflect begin their upswing.

Subscribe to Kiplinger’s Personal Finance

Be a smarter, better informed investor.

Save up to 74%

Sign up for Kiplinger’s Free E-Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Sign up

To continue reading this article
please register for free

This is different from signing in to your print subscription

Why am I seeing this? Find out more here

Contributing Editor, Kiplinger's Personal Finance