I haven't invested in any additional ASX shares this December. And with Christmas and all of its expensive joys just around the corner, I'll probably hold off. But if someone asked me where I'd like to invest some extra cash this month, only one ASX investment comes to mind today.
That would be the iShares Global Consumer Staples ETF (ASX: IXI).
I already own units of this exchange-traded fund (ETF). But I'd like to own more, especially going into 2024.
Why? Well, 2024 is shaping up to be an interesting year. I'm an eternal optimist when it comes to the share market. But I also pay attention when experts speak.
A recession in 2024?
This morning, my Fool colleague Tony covered the views of renowned AMP economist Shane Oliver. Although Oliver predicted a healthy year for ASX shares in 2024 (thanks mostly to falling interest rates), he also states that "the risk of recession is high".
As such, I'm not feeling too tempted to add to the more cyclical stocks in my portfolio. That includes Adairs Ltd (ASX: ADH), Kogan.com Ltd (ASX: KGN), Apple Inc (NASDAQ: AAPL) and Tesla Inc (NASDAQ: TSLA).
Instead, I'd be more inclined to buy companies that have always demonstrated that they can survive and even thrive during an economic downturn. Chief amongst those are consumer staples stocks.
When the economy is going through a tough time, consumers tend to pull back on buying brand-new, exciting things, and tilt toward simpler pleasures. Those could be a tub of ice cream, a bar of chocolate, a cup of tea or a glass of wine or two.
Additionally, no matter the economic weather, most of us will undoubtedly continue to spend money on life's basics, be that dishwashing tablets, laundry powder, soap or razors.
The companies that provide these goods are almost all represented in the iShares Global Consumer Staples ETF.
Where to invest $10,000? This simple ETF
Take top-holding Unilever. It owns Bushells and Lipton Tea, as well as Ben & Jerry's and Streets ice creams. Not to mention Omo laundry powder and Lynx bodyspray.
Mondelez International is the company behind Oreos, Cadbury, Ritz biscuits and Natural Confectionary lollies.
And Procter & Gamble owns some of the most well-known household brands out there. Oral-B, Vicks, Old Spice, Pantene, Fairy, Head & Shoulders, Gillette… the list goes on.
Along with all of the names listed above, some more of this fund's top holdings include Nestle, Coca-Cola, Walmart, Diageo and Philip Morris International.
I think investing in these kinds of names when tough economic times might be on the horizon is a prudent move. And, although the likes of Unilever, Procter & Gamble and Mondelez aren't listed on the ASX, the IXI ETF sure is.
As such, if I were asked where to invest $10,000 this December, I would be more than happy to pick the iShares Global Consumer Staples ETF.
This ETF offers a highly defensive investment for one, resistant to both inflation and economic downturns. But it has also provided some solid returns over recent years.
As of 30 November, IXI has returned an average of 8.75% per annum over the past decade. It also comes with an approximate 2% dividend yield.
