MENU

2 safe shares to shelter from the volatility

The ASX share market has fallen nearly 2.8% today, marking one of the worst days for years.

I can understand if you’re feeling a bit unsettled by the sudden disruption to the calm period we’ve experienced over the past couple of years.

However, shares weren’t always going to be calm. If you don’t think you have the right temperament for this, or your shares are the wrong ones, it may be worth owning businesses that should be able to sail through this.

Of course, any share price can fall, but it’s the underlying operations of the business that counts.

Here are two ideas:

Duxton Water Ltd (ASX: D2O)

Duxton Water owns water entitlements and leases them to agricultural businesses. The Duxton Water management believe the returns offered by water entitlements are essentially uncorrelated to other assets.

There is a limited amount of freshwater in the world, particularly in Australia. In a dry year farmers will pay what it takes to make sure their crops have the required amount of irrigation.

The Duxton Water share price is supported by the underlying value of its water portfolio and the lease income.

It’s one of my favourite ‘alternative’ investment ideas compared to a typical growth company.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is an investment conglomerate that has been operating for over a century. It has a long-term investment focus and picks companies it thinks will be solid performers for years ahead.

Some of its main investments include Brickworks Limited (ASX: BKW) and TPG Telecom Ltd (ASX: TPM).

It has had a great run over the past year, but the growth of its underlying assets has justified the increase. Winners, like Soul Patts, usually keep winning over the long-term.

If I had to let all of my money be managed by someone else, Soul Patts would be one of the main contenders.

Foolish takeaway

I’m glad I own both of these shares in my portfolio, although I wish I had bought more Soul Patts shares when they were under $17! At the current prices I’d go for Duxton Water.

Another business that could offer safety is this very defensive ASX growth share that is a market-leader in the auto industry. It’s just starting to expand into Asia too!

The best dividend stock to buy this month

You might not know this market leader's name, but it's rapidly expanding into a highly profitable niche market here in Australia. Even better, the shares boast a strong, fully franked dividend that should balloon in the years to come. In other words, we're looking at the holy grail of incredible long-term growth potential AND income you can watch accruing in your account in real time!

Simply click here to grab your FREE copy of this up-to-the-minute research report on our #1 dividend share recommendation now.

Motley Fool contributor Tristan Harrison owns shares of DUXTON FPO and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Brickworks and TPG Telecom Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The 5 mining stocks we’re recommending in 2019…

For decades, Australian mining companies have minted money for individual investors like you and me. But if you believe the pundits and talking heads on TV, those days are long gone. Finito! Behind us forever…

We say nothing could be further from the truth. To earn the really massive returns, you’ve got to fish where others aren’t fishing—and the mining sector could be primed for a resurgence. That’s why top Motley Fool analysts just revealed their exciting new research on 5 ASX miners they believe could help you profit in 2019 and beyond…

Including:

The best way we see to play the global zinc shortage… Our #1 favourite large-cap miner (hint: it’s not BHP)… one early-stage gold miner we think could hit the motherlode… Plus two more surprising companies you probably haven’t heard of yet!

For free access to our brand-new research, simply click here or the link below. But be warned, this research is available free for a limited time only, and we reserve the right to withdraw it at any time.

Click here for your FREE report!