Peter Quinton: Ten favoured defensive stocks

A well-constructed portfolio should always have some defensive stocks, which we identify using four investment criteria: 1) Market capitalisation of at least $1.0 billion; 2) The investment arithmetic — price earnings ratios, dividend yields, and so on—must be reasonable compared to the valuations of the overall share market; 3) The balance sheet ratios must be strong—net debt/shareholders’ funds and interest cover; 4) The stock has to be rated a Buy or Neutral by the analyst as per our latest Research reports. We have identified ten favoured defensive stocks below.