Transcription
These are the seven best stocks to buy in a volatile market, and I guarantee some of these are going to surprise you. Now, as always, don't click nothing, don't smash nothing, don't buy nothing. Let's get started.
So far, 2025 has been unpleasant. A lot of headlines are talking about a potential recession, a potential stagflation, a potential market crash; a lot of speculation about the bad that's about to hit the stock market and the economy. The fear is that we're going to go to a full-blown recession and a potentially full-blown crash because of the Donald Trump administration's tariff policy.
Now, first, before we start with the stocks and all that stuff, I just want to make sure we understand what's going on here. Regardless of the Donald Trump tariffs, we always had volatility in the stock market. This ain't nothing new; it's not our first rodeo. Now, if you just got on the plane for the first time in your life, turbulence might seem like the plane is coming down, and yet nobody has ever died because of turbulence. If you were in a few flights before in your life, you know it's just turbulence. It's unpleasant, but you know it's nothing to get excited about. The same thing in the stock market: if you started investing in 2023 and onwards, basically over the past two years, this would be your first time of market volatility, and I'm here to tell you, hey, sit back, relax; it's just turbulence.
Now, the stock market is a very volatile thing; it's always been like that. 5% drops on the S&P 500 happen three times a year. A 10% drop, which is what we have from the February highs on the S&P, that happens once per year, and every couple of years we have a 15% drop. Nothing to get excited about; absolutely normal. These fluctuations feel severe in real time, and I totally understand, but they feel a lot worse than they really are. There's nothing, nothing to get excited about.
Now, the initial question you need to ask yourself as a long-term investor here is: how do I navigate this environment? Because obviously things have changed. The market of 2025 is not the market of 2023 and 2024. The good times, playing the video game on very, very easy mode, on rookie mode—that has gone out the window. We're now in a completely different market. So how do you navigate this? Because playing this game in 2025 just got a little bit harder, but it doesn't mean you can't make money.
Now, the S&P 500 right now is down 10% from the February highs. We have Tesla down almost 30% year-to-date. It feels really, really bad, and it feels unpleasant, and I totally get it. Now, the Trump tariffs right now seem to be going forward. The April 2nd date is the doomsday scenario. People fear that the reciprocal tariffs from the other countries are going to cause Trump to levy more tariffs, which is going to lead to a trade war, potential inflation spike, obviously as prices will go up, potentially going into stagflation. Stagflation means high unemployment and high inflation, and a lot of this is uncertainty. Nobody exactly knows what's going to happen from now until April 2nd, from April 2nd until the end of the year. Nobody knows how the tariffs are going to look like, how they will be implemented, and how it's going to impact the economy from this point until the end of the year, and there's a lot of uncertainty, and rightfully so. But the one thing markets absolutely hate with a vengeance, more than anything else in the world, is uncertainty.
Now, if you've ever trained a dog, I can tell you that once a dog becomes uncertain, once a dog—dog—once a dog becomes insecure, the level of aggression this dog is going to present is going to be insane. Not because the dog hates you, not because the dog wants to bite you, not because he wants to harm you; it's because the dog feels uncertain, it feels insecure, and when the dog feels insecure and uncertain, it lashes out as a protective mechanism. It's an instinct. The same thing with the stock market; that's how people get bitten. When the stock market gets uncertain, it gets very aggressive, and a lot of people lose their pants.
Now, that's exactly what happened to a friend of mine back in 2020, and I promise you this is a real story, and I also promise you that this happens a lot more often than you think, and this story actually happened in 2020. So back in those days when the pandemic hit, a lot of experts came on CNBC and other media outlets talking about how bad things are going to get, how this changes the world. A lot of people got scared. The market dropped from 3,400 to 2,300, the S&P, and my buddy, against my better judgment, actually sold at 2,300, right at the bottom, at a 30% loss, saying, "Hey, I'd rather take that 30% loss than lose everything. I think things are about to get really, really bad." Now, I explained to him the same things I explained to you, but he didn't want to listen. He's a grown-up; it is what it is. Now, by September of the same year, six months later, the market was back to 3,400, so his 30% loss just became very, very painful, and he never came back to the market until it was too late. He actually bought back in—I'm not even kidding you—in December of 2021 when the market actually hit 4,700. He had enough; he's like, "Okay, this market is back; I'm sorry; I made a mistake; I'm going to jump back in." He jumps back in at 4,700, finally saying, "I'm back." And then the market goes to 10 months of bear market, dropping from 4,700 all the way down to 3,580, and my buddy says, "I had enough; sales again at 23% loss, never to come back again to the stock market." To this day, he promises me he'll never set foot in the stock market, taking a 30% loss and a 23% loss when the market actually doubled from 2,300 to 5,700 today from that point. So the market doubled, and he lost a lot of money. That happens more often than you think; that happens to 90% of retail investors; I'm not even kidding you, because the media is working against these folks; it's working in their best interest, not the best interest of the people who are investing. Media drives hysteria; they drive panic; they drive clicks. These TV experts on there, they're not there to help you; they're there to promote their agenda, their brand. Nobody on mainstream media is trying to help you out; remember that. You got to watch your own back. And a lot of people will say, "Well, Tom, you use the same clickbait tactics that mainstream media does with all this panic and all this fire; it's over; this is bad." Sure, I do; that's exactly the point. I do the exact same thing these guys do, but my content is the polar opposite. I teach people how to do long-term investing, how to get off the hamster wheel, how not to be the sheep being led to the slaughterhouse, because at the end of the day, retail investors have always been the piggy bank of institutional investors; that 20% of the market funds that 80% of rich folks. I was about to say something else because the market has the same cycle repeat itself every freaking time, and always the victims are the retail investors. They don't know what they're doing, and I get it; we're all different; not all of us have the same opinions about where this market is headed. Some of you may be bearish about the market going forward, and that's legitimate; you may be right. If that is your approach, if your analysis says, "Hey, I'm bearish for the next year; I think it's more likely than not that the market is going to go down," well, you can go higher cash in your portfolio; you can trim some of your winners and derisk if you think that bad times are coming. If you're bullish about the stock market, well, all you got to do is dollar-cost average into your stocks and your ETFs and double down on bad times and think in 5 years, not in 5 days. Regardless of whether you're bullish or bearish about the market going forward, it's okay to be uncertain. In fact, chasing certainty in the stock market leads to losses, as Ashwag, the mother, said—one of the best to ever do this—you have to get comfortable with not knowing what's going to come next. There's never going to be any certainty in the stock market. So what you want to do in times like these is to remain calm, understand that this is a long-term game, create yourself a nice little emergency fund of six months, and diversify into more defensive positions on top of your existing winners. And that's exactly what I'll say in the next segment; I'll give you the seven stocks to buy right now in this volatile market.
Now, these stocks are not here to replace Palanteer and Tesla and some of your winners or the S&P 500. This is the defense you're adding to your portfolio; the diversification you're adding to protect yourself in case bad times are coming. This is your insurance policy. So these stocks are going to be absolutely different than the normal stocks in your portfolio, but they'll still follow the quality guidelines I'm about to tell you right now. Number one: the fundamentals have to be there. They have to have good revenue growth; they have to have good free cash flow; they have to have a strong balance sheet; not a lot of debt, a lot of cash; they have to have a mode; we're not doing pure commodity businesses; and they have to have a mode, either through brand strength, through regulatory, through network effects, through intellectual property, patents, and of course, historically, they have to perform better in bad times than some of the other stocks that we usually cover on this channel.
Now, the first stock I want to start here with is Berkshire Hathaway. Now, Berkshire Hathaway is an absolute fortress; it's a mini ETF with everything, starting from utilities, infrastructure, even tech; they got Apple, a lot of it. Now, slower growth in good times for sure, but in bad times they perform a lot better and have a much higher floor than all of the other tech stocks you've been hearing about for the past two years, and that's the sort of stock you want to have when times get choppy and uncertain.
Stock number two is Johnson & Johnson, ticker J&J. Now, this is a healthcare pharmaceutical, and healthcare tends to be one of the best defensive categories to be in in uncertain times. People cannot cut back on healthcare; you cut back on luxury; you can't cut back on medicine, right? In 2000 and 2008, on average, when the S&P 500 dropped almost 50%, the healthcare sector only dropped 27%. That's a lot better; in fact, twice as good as the S&P 500 in a really, really bad time. Now, the mode here is significant; they have a very strong brand; they have global presence, and also they actually have decent growth and upside, not as much as the tech names we've been talking about over the past two years, but very, very good company with really strong brands and a demand that's almost absolute. These guys are going nowhere, and even in the recession they're still going to sell the same amount of pharmaceutical and products and all that stuff.
Number three: PNG, Proctor & Gamble. Now, the same story, but comes from an angle of consumer staples. Now, consumer staples are toothpaste, shaving cream, all the things people must have. In the recession, people still want to shave; they want to brush their teeth; they want to do laundry. All of these things—this is the Proctor & Gamble wheelhouse, so to speak. These guys have shampoos; they have toothpaste, Pampers, Gillette, Tide—you name it. I mean, these guys are absolutely the best in the world at consumer staples, and if you look at history, consumer staples in 2000 and 2008, while the S&P dropped almost 50%, dropped only 21.8%; it's actually even better than healthcare as a class.
Next up, we got Costco, and obviously, unless you've been living under a rock, you know what Costco is. My family has a membership; you have a membership; everybody has a Costco membership. It's a bulk discount retail, and they're actually one of the best recession-suited businesses out there. They have almost steady demand, recurring revenue because of the memberships, and lots and loyalty. These guys are going nowhere, especially in the recession.
Next up, we got Walmart, WMT. Now, Walmart is very, very similar; same parameters that we talked about with Costco, but a little bit different, of course. They are recession-proof, but they also have a lot of e-commerce presence, which Costco is not as strong in, and their mode includes everything: scale, distribution, prices, supply chain—less smile. They're one of the best in the world at that; obviously, they have thin margins; they're not really great in a bullish cycle, but if we're going for bad times, these guys are actually going to do better than most of the other stocks in your portfolio if your focus so far was tech.
Now, next up, we got PepsiCo, PEP. Now, you think about PepsiCo, you think about Pepsi, but they're a lot bigger than Pepsi. In fact, mostly they come from sports drinks, from snacks, from chips, from candy; I mean, they're massive, and believe it or not, snacks and beverages tend to do very, very well in recessions. I guess people like to eat their way out of trouble; I mean, I heard a thing or two about that myself. Jokes aside, they're very resilient, and the brand mode is almost absolute here; it's almost as good as Coke, but also they have a lot more diversification than Coke, in my opinion; that's why I chose PepsiCo and not Coke. I think these guys are probably one of the best investments to hold during an uncertain time because, I mean, people are still going to buy soda and and snacks; I mean, this thing is not going anywhere.
Now, we have the final stock here, and I told you one of them will surprise you, and this is going to shock you: Nvidia is my seventh stock for this list. And why is Nvidia listed with PepsiCo, Walmart, Costco, J&J, Berkshire Hathaway? What the hell is going on, Tom? Now, look, Nvidia is a surprise, but think about it this way: Nvidia is almost the monopoly in AI infrastructure. Everybody is upgrading their servers to AI servers, and this infrastructure cycle has nothing to do with consumer strength; it's a B2B—well, it has some to do with consumer strength, but not as much as a B2C business. This is a business-to-business, and this thing is happening whether we enter recession or not. Everybody's going to upgrade their servers; Nvidia is the only game in town. There's about 80% more spend; we're only down 20% through this road of infrastructure upgrades; a lot more upside. And sure, Nvidia is volatile; sure, Nvidia is very, very cyclical, but out of all these tech companies, Nvidia, given the current setup and their history, tend to recover absolutely insanely fast. So even though they are cyclical, their recovery historically is very, very fast. So that's why Nvidia is on that list, despite not being a classical defensive stock. I think it's going to perform very well longer term in a really bad time, even though it's a tech name. I get it; trust me on this; Nvidia is no slouch. And of course, you still want to hold on to the stocks that got you so far: Palantir and Tesla, for me; ETF, S&P 500, for me; generational stocks. Palantir and Tesla are going to do incredible things over the next 5-10 years; S&P 500 is a cheat code; I'm not selling out of these; I just gave you some ideas about potential diversification options in order to prep yourself and get some insurance if indeed we're heading to some bad times. We actually have a list of 25 stocks, my top 25 stocks list, if you want to get access to it; it's on my academy: patron.com/domnash. Would love to see you there. On top of that, you have 45 lectures on how to become a better long-term investor; 17,000 members would love to have you join us. Thank you; I'll see you next one; peace.