The average 401(k) balance has plummeted by a paltry $29,000 over the past year -- but these 3 large-cap stocks have spared investors the pain (and could do so again in 2023)

The average 401(k) balance has plummeted by a paltry $29,000 over the past year -- but these 3 large-cap stocks have spared investors the pain (and could do so again in 2023)

The average 401(k) balance has plummeted by a paltry $29,000 over the past year — but these 3 large-cap stocks have spared investors the pain (and could do so again in 2023)

2022 continues to provide a harsh reality check to stock market investors.

According to financial services giant Fidelity, the average 401(k) balance fell from $126,000 a year ago to $97,200 in Q3 — a loss of nearly $29,000, or 23%.

Not exactly a surprise. The benchmark S&P 500 is down 17% year to date, while the tech-focused Nasdaq has tumbled nearly 30% over the same period.

If you don’t want to get caught up in the wild swings of the market, you might want to check out some low-beta stocks (also known as low-volatility stocks).

Beta is a measure of a stock’s volatility relative to the market as a whole. If a stock has a beta greater than one, it is more volatile than the broad market. Stocks with beta values ​​less than one are less sensitive to market movements.

Here’s a look at three low-beta stocks that might be worth considering.

Do not miss

Walmart (WMT)

At a time when many brick-and-mortar retailers remain stagnant, the mighty Walmart stands out.

The company operates a vast retail business with approximately 10,500 stores under 46 banners in 24 countries. Thanks to its “Everyday Low Prices,” Walmart attracts about 230 million customers to its stores and websites each week.

Walmart could be an option for those looking for low volatility: the stock’s five-year beta is just 0.53, and it’s actually up 5.5% over the past year.

And because of the company’s huge economies of scale, the business has remained sustainable over several economic cycles.

Consider this: Walmart paid its first dividend in 1974. It has increased its payout every year since then.

Johnson & Johnson (JNJ)

With deeply entrenched positions in the consumer health, pharmaceutical and medical device markets, healthcare giant Johnson & Johnson delivers consistent returns to investors.

Many of the company’s consumer health brands — such as Tylenol, Band-Aid and Listerine — are household names. In total, JNJ has 29 products, each of which can generate over $1 billion in annual sales.

Over the past 20 years, Johnson & Johnson’s adjusted earnings have grown at an average annual rate of 8%.

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JNJ announced its 60th consecutive annual dividend increase in April and now offers an annual dividend yield of 2.6%.

The stock has a five-year beta of 0.57 and is up 8% over the past year.

Coca-Cola (CO)

Coca-Cola is a classic example of a recession-proof business. Whether the economy is booming or struggling, a can of Coke is within reach of most people.

The company’s entrenched market position, sheer scale and portfolio of iconic brands – including names like Sprite, Fresca, Dasani and Smartwater – give it great pricing power.

Add solid geographic diversification—its products are sold in more than 200 countries and territories around the world—and it’s clear that Coca-Cola can thrive in any event. The company eventually went public more than 100 years ago.

According to its latest earnings report, Coca-Cola’s net income rose 10% year-over-year, while its adjusted earnings per share improved 7%.

The stock has a five-year beta of 0.58 and is up 11% in 2022.

Still can’t stand stocks?

Of course, you don’t have to limit yourself to stocks.

Amid hot inflation and an uncertain economy, savvy investors are diversifying their investments outside of the stock market.

Prime commercial real estate, for example, outperformed the S&P 500 over a 25-year period. S help on new platforms, these types of opportunities are now available to retail investors. Not just the ultra-rich.

With a single investment, investors can own institutional-quality properties leased by brands like CVS, Kroger and Walmart — and collect steady income related to grocery stores on a quarterly basis.

This article provides information only and should not be construed as advice. Provided without any warranty.

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