Stock market crashes can be terrifying events. It's never fun to see the value of your hard-earned shares fall in value, through no fault or action of your own.
Many investors, including myself, try to turn this unpleasant situation into an advantage, by using the opportunity of lower share prices to pick up additional assets.
But for many investors, such as retirees and those with no other income streams coming through the door, market crashes can still be enormously unnerving events. So if a stock market crash is coming, which ASX shares would I want to hold to minimise the chances of a permanent capital loss?
Well, I would turn to the consumer staples sector. Consumer staples shares are the companies that sell us everyday essentials like food, drinks and household items. Because of the 'staple' nature of these goods, these companies tend to be a bit more resilient than other ASX shares and often don't suffer as much as other shares in stock market crashes for this reason.
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2 ASX shares I would want in a stock market crash
The first is Coles Group Ltd (ASX: COL). Coles is one of the most well-known shares on the ASX, and for good reason. Most suburbs around the country sport one of Coles' distinctive red storefronts.
Coles has a strong track record of surviving and thriving during tough economic times. As an example, this is one of the few ASX 200 shares that delivered a dividend pay rise in both 2020 and 2021, years that were extremely tough for obvious reasons.
We saw the Coles share price stand up remarkably well in the COVID crash of 2020. And, unlike its arch-rival Woolworths Group Ltd (ASX: WOW), I think the Coles share price is relatively cheap right now. It's for these reasons that this company is one I would be very happy to hold over a stock market crash:
The second is an exchange-traded fund (ETF) in the form of the iShares Global Consumer Staples ETF (ASX: IXI). My reasons for choosing this ETF for a stock market crash are similar to those of Coles.
However, the iShares Consumer Staples ETF holds more than 100 shares sourced from all around the world. Woolies and Coles are in this ETF's portfolio, but so are other consumer staples giants like Walmart, Costco, Coca-Cola, Philip Morris International, Colgate-Palmolive and Kraft Heinz.
This ETF has returned an average of 11.24% per annum over the past ten years, has a strong dividend history, and houses some of the world's best brand names. So thus, it's another ASX share I would be more than happy to hold during a stock market crash.
