Over the course of the last year, the ASX has occupied a range of 588 points, from 5070 in February last year to 5658 in September last year. This, though, doesn’t paint the full picture since the ASX has been relatively volatile and has flipped between large gains and losses regularly.
With this in mind, here are three stocks that could help you overcome the volatility of the wider index. They also offer bright prospects and could be worth buying right now.
Westpac Banking Corp
With a beta of just 0.85, shares in Westpac Banking Corp (ASX: WBC) should (in theory) move by just 0.85% for every 1% move in the ASX. This could prove to be a real asset if the wider index continues to remain volatile, but that doesn’t mean that Westpac is a one trick pony.
In fact, Westpac continues to offer good value for money relative to the wider index and to its sector. For example, it has a price to earnings (P/E) ratio of 13.6, which is lower than the ASX’s P/E ratio of 14.9 and also below the wider banking sector P/E ratio of 13.9. As such, Westpac could offer upward rerating potential.
Coca-Cola Amatil Ltd
Like Westpac, Coca-Cola Amatil Ltd (ASX: CCL) has a low beta of just 0.55 and, in times of uncertainty, this could prove to be a major positive. In addition, Coca-Cola Amatil continues to offer good value relative to the wider index, with it having a price to sales (P/S) ratio of 1.42, while the ASX’s is higher at 1.56.
Furthermore, an excellent track record of increasing cash flow (it has risen at an annualised rate of 10.5% over the last five years) should also provide investors in Coca-Cola Amatil with confidence regarding its financial position, as it moves through a transitional period. As such, it could be a top long-term performer.
QBE Insurance Group Ltd
Having a beta of 0.6 means that QBE Insurance Group Ltd (ASX: QBE) also appeals as a lower volatility play. However, it also offers significant income potential, with QBE being forecast to increase dividends at a rapid rate in the short term, which means that its shares could yield as much as 5% next year.
Although it is a long way off reaching its goals, as it seeks to become a more efficient and simpler business, QBE is making excellent progress. Furthermore, with a P/E ratio of 13.4, it seems to offer good value for money while the wider insurance sector has a P/E ratio of 17.2. As such, it could be worth buying right now.
Where to invest $1,000 right now
When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*
Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.
*Returns as of June 30th
Motley Fool contributor Peter Stephens does not own shares in any of the companies mentioned.
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