- Investors who chose to take a defensive approach with the rise of trade tensions months ago have been duly rewarded.
Utilities, pharmaceuticals, small caps, and consumer staples have all outperformed the broader market.
The thinking, according to investment strategists, is that all of these groups are less exposed to a trade war, because they are less reliant on exports.
In addition, the fortunes of defensive stocks do not rise and fall with the ups and downs of the economy.
Thus far, pharmaceutical stocks have been the standout performer.
The pharmaceutical sector is up 14% since early May, five times the gain of the S&P 500.
The Russell 2000 index of small-cap stocks is up more than 10% during that time, while hitting new record highs.
Consumer staples, which includes food companies, are up more than six percent.
And utilities have gained about 5%, double the S&P's gain.