The "defensive stocks" category consists of companies in the food, home supplies, healthcare, utilities, and real estate segments. Such stocks also tend to pay dividends to their shareholders, guaranteeing a small yet stable form of income.
Defensive stocks tend to outperform other sectors during recessions due to their common necessity. Even during periods of economic downturn, consumers will need the products sold by such companies, and that steady demand keeps these companies afloat even during the most trying economic times.
A few large defensive stocks include Coca-Cola, Johnson & Johnson, and Philip Morris. These companies still trade daily and follow broad market trends, but for those who'd prefer to keep their money in stocks, these businesses have held their value better than others in bear markets.