As interest rates rise, the stocks that drove portfolios last decade are falling out of favour.
Many experts are warning that high-growth technology ASX shares will not produce the same dizzying returns as they did in the days of near-zero rates.
Instead, investors will have to turn to businesses that provide goods and services that the world just can't live without.
Here are two such examples currently rated as buys:
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'A critical mineral' for electric vehicles
According to BW Equities equity salesperson Tom Bleakley, Syrah Resources Ltd (ASX: SYR) is the "biggest graphite producer on the ASX".
And that's important because about 20% of the weight of a modern lithium-ion battery is made of graphite.
"Graphite is a critical mineral for the transition to electric vehicles," Bleakley told The Bull.
"The International Energy Agency forecasts strong demand for graphite between 2020 and 2040. We believe Syrah offers a bright outlook."
Tribeca Global Natural Resources Limited (ASX: TGF) portfolio manager Ben Cleary certainly agreed with Bleakley.
"They're going to make good margins regardless of whether commodity prices remain high," Cleary told Livewire last month.
"They are… at the bottom of their respective cost curves. And they all have been very focused on keeping their best people, as labour is tight."
'Consistent' earnings that are recession-proof
Essential products don't come any more essential than water.
As such, Shaw and Partners senior investment advisor Jed Richards likes the look of Duxton Water Ltd (ASX: D2O).
"The company buys water entitlements and leases them to farmers," he said.
"Earnings are consistent, reliable and uncorrelated with the rest of the economy."
With food inflation rampant, there will be hot demand for the local agricultural industry. And on a dry continent like Australia, there is always "a shortage of available water entitlements", according to Richards.
"Combined with a significant increase in demand from the horticultural industry, [this] should lift the value of permanent water assets."
Duxton has also been giving cash back to investors through a 12-month on-market share buyback program that's been in place since October last year.
"The ongoing share buyback will support the price in the short term," said Richards.
"The company was recently trading on a grossed up and appealing dividend yield of around 5.2%."
