Navigating Trade Wars: Why Low-Volatility Stocks Could Be Your Best Defense

In the ever-shifting landscape of global markets, the recent escalation of trade tensions has introduced a wave of uncertainty that investors must navigate. As markets react to increased tariffs and retaliatory measures spearheaded by government policies, many are left wondering: where should I invest to minimize risk?

At the Extreme Investor Network, we believe that understanding how to strategically position your portfolio during turbulent times is essential. Let’s delve into why low-volatility stocks could be the answer to your investment concerns in periods of economic stagnation and trade wars.

The Current Economic Climate: A Quick Overview

Weeks of simmering trade tensions have recently exploded into a full-blown trade war, particularly affecting relations with key partners like Canada and Mexico. With major indices—including the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average—falling approximately 2% this week alone, the landscape can seem daunting for investors. As panic selling often leads to greater volatility, many are seeking refuge in more stable, low-volatility investments.

According to a report by Evercore ISI, low-volatility stocks have historically thrived under similar economic conditions. Even in the earlier stages of trade tension in 2018, these investments outperformed their riskier counterparts, showcasing an essential defensive strategy for investors.

Defense as the Best Offense

Senior Managing Director Julian Emanuel from Evercore notes, "Defense remains the best offense." With more tariffs set to be implemented, the firm signals that investors will increasingly lean towards low-volatility options. But what exactly are these stocks, and how do they stand to perform?

Low-volatility stocks are typically those that fluctuate less than the broader market. They are often associated with established companies that boast strong fundamentals and consistent revenue streams. For example, health-care giants like AbbVie, Centene, Humana, and UnitedHealth Group are predicted to thrive during this turbulent time. These sectors tend to perform well during economic slowdowns and have already seen an impressive 8% increase in 2025 year-to-date, topping other S&P 500 sectors.

Spotlight on Strong Performers

AbbVie

AbbVie is a compelling investment amid the trade climate. With its diversified drug portfolio and a recent entry into the burgeoning obesity treatment sector, the company is showing robust growth potential. In 2025, AbbVie saw a remarkable 17% increase in its share price after exceeding Wall Street’s estimates for its fourth-quarter results.

DaVita

While DaVita’s shares are down nearly 4% this year, technical analysis reveals that it could be on the brink of a significant bounce-back, potentially outperforming the S&P 500 in the long run. With an aging population and increasing demand for kidney care, it’s a stock that deserves attention.

Apple

In the technology realm, Apple stands out as a defensive pick. Despite a 4.7% drop in shares this year, analysts suggest it’s become a safe haven among the "Magnificent Seven" tech stocks, primarily due to the integration of artificial intelligence, which may kickstart a new upgrade cycle for iPhones.

Defense Industry Stocks

It’s worth noting that even some defense-focused stocks, like Booz Allen Hamilton and Lockheed Martin, are catching the eye of cautious investors. Although Booz Allen has dipped nearly 16%, defense contractors often prove more resilient in volatile markets due to their reliance on government budgets rather than broader economic performance.

Why You Should Consider Low-Volatility Investments

In summary, while the unfolding trade war poses significant challenges, it also opens doors for savvy investors to capitalize on low-volatility stocks that historically navigate turbulent waters more successfully. At Extreme Investor Network, we’ve always championed the philosophy that a diversified, defensive strategy is paramount to weathering economic storms.

If you want to stay ahead of the market and ensure your investments are secure regardless of external conditions, consider leaning into these low-volatility players. An intelligent approach tailored to current events can make all the difference in your portfolio’s resilience.

Stay tuned for more insights, strategies, and stock analyses from the Extreme Investor Network, your partner in navigating the complex world of investing.