Mr Cole says: “We are not allocating more towards defensive stocks in anticipation of more volatility. The last twelve months have seen plenty of that.
“We are wary of what we would describe as expensive defensives here and are more drawn towards value even within what are traditionally seen as cyclical sectors.”
He adds that the market conditions of today resemble a period in the 1950s when a small number of consumer staple stocks with defensive characteristics performed extremely well, and then later underperformed for an extended period.
Keith Balmer, a product specialist on the multi-asset team at BMO says buying the cheapest stocks as a way to invest defensively is a method that makes logical sense over the long-term, it is fraught with risk in times of market strife.
He adds: “Historically, buying the cheapest assets has been a rewarding strategy over the long-term, although not necessarily into and throughout an economic/market correction.
“While low valuations appear to discount an unfavourable outcome, sadly “bad news” is never in the price and valuations, no matter how low, seemingly offer little support in the face of downgrades.
It may also be that these lowly valued businesses are structurally challenged longer term, therefore justifying a lower multiple.”
Mr Balmer says being diversified across asset classes and equity types is the best way to be defensive.
Mr Krishnan is combining investments within one of the traditionally defensive sectors he likes; US healthcare, with a more traditionally economically sensitive sector, banks.
The fund manager Nick Train, in his latest update to investors in his £1.8bn Finsbury Growth and Income trust said the recent underperformance of the trust is the result of investors in the UK selling off the large, internationally focused stocks with defensive characteristics that he owns.
And instead, they are buying companies with more exposure to the UK domestic economy, as a result of a view gripping the market, that domestically focused companies will perform better now as the threat of a “no deal” Brexit has receded.
Mr Train says he doesn’t regard the largest stocks in his portfolio, such as Diageo and Unilever, as simply defensive.
He feels they are global companies, which have proved resilient over decades and have products for which there is constant demand around the world.
As global GDP expands, so too will the demand for the products of these companies.
He adds that short term market shifts are not relevant to the long-term prospects for the companies.