7 Low Risk High Reward Stocks 2024 | Low Risk Investments
7 Low Risk High Reward Stocks | Low Risk Investments Stocks. Risk is absolutely fundamental to investing; no discussion of returns or performance is meaningful without at least some mention of the risk involved. In this time of uncertainty due to the pandemic, It is totally justified to seek out safe stock investment.
There is a lot of low-risk, high reward stock options to consider. While it’s true that the amount of return you can get depends on how much risk (and losses) you are willing to accept, great investors make their living by balancing these two.
What Are Some Of The Low Risk High Reward Stocks?
Here are the low risk, high reward stocks to buy to help you grow your money safely.
- Berkshire Hathaway.
- Walt Disney company.
- Apple
- McCormick
- Dollar general
- Treasury funds.
- Fixed annuities.
- Moody’s
- Starbucks.
- Procter & Gamble.
What is Low-Risk Investment all about?
With low-risk investing, there is less at stake, either in terms of the amount of invested or the significance of the investment to the portfolio. There is also less to gain either in terms of the potential return or the potential benefit bigger term. Low-risk investing not only means protecting against the chance of any loss, but it also means making sure that none of the potential losses will be devastating.
If investors accept the notion that investment risk is defined by a loss of capital and/or under-performance relative to expectations, it makes defining low-risk and high-risk investments substantially easier.
7 Best Low Risk High Reward Stocks
1. Berkshire Hathaway – (NYSE: BRK-A) and (NYSE: BRK-B)
Berkshire Hathaway (NYSE: BRK-A), (NYSE: BRK-B) is a multinational conglomerate that owns a collection of about 60 business subsidiaries, including GEICO, Duracell, and others. Many like these generally do well irrespective of climate. They also own a significant minority in public companies like Kraft Heinz Company (26.7%), The Coca-Cola Company (9.32%), Bank of America (11.5%), Apple (5.4%) the company acquired large holdings in the major US airline carriers, namely United Airlines, American Airlines, to name a few but sold all of its airline holdings early in 2021.
2. Apple – (NASDAQ: AAPL)
Apple Inc. is a multinational technology company with headquarters in Cupertino, California, that designs, develops, and sells consumer electronics, computer software, and online services. Apple trades as (NASDAQ: AAPL) and has a long-lasting advantage of both an extremely loyal customer base and an ecosystem of products designed to work best in conjunction with one another. In other words, iPhone customers tend to remain iPhone customers. It is considered one of the Big Tech technology companies, alongside Amazon, Google, Microsoft, and Facebook.
3. Starbucks – (NASDAQ: SBUX)
Starbucks Corporation traded as (NASDAQ: SBUX) is a multinational chain of coffeehouses and roastery reserves. With headquarters in Washington, it has become the world’s largest coffeehouse chain. Its trusted brand gives the company pricing power over rivals, and its massive scale gives it efficiency advantages too.
4. Treasury Funds
Treasury funds are treasury bills, notes, and bonds. These securities principles are dependent on whether inflation goes up or down. They are issued by the United States Department of Treasury. It is important to note the following about treasury funds. With Treasury securities, you can either buy or sell directly or through mutual funds, or wait till it matures. You aren’t able to break your maturity date. If you keep Treasury until they mature, you won’t lose any money, unless you buy a negative-yielding bond.
5. McCormick – (NYSE:MKC)
McCormick (NYSE:MKC) is a diversified food company that makes spices and flavorings. The company hasn’t posted a negative annual return since 2008, which means it has seen its stock price grow each year for the past 12 years. While the historical EPS growth rate for McCormick is 12.2%, investors should actually focus on the projected growth.
6. Moody’s – (NYSE: MCO)
Few stocks have been as reliable over the past decade as Moody’s (NYSE: MCO). The company who provides credit ratings, research & analysis covering, fixed-income securities, other debt instruments & quantitative credit risk assessment services for banks, corporations & investors have posted an annual return of 24% over the last 10 years and has performed well this year too up about 15% year to date.
7. Dollar General – (NYSE:DG)
Dollar General Corporation (NYSE:DG) is a discount retailer that offers a selection of merchandise including consumables, seasonal home products, and apparel. They have been a powerful performer in 2022, up about 22% year to date.
8. Walt Disney Company
The Walt Disney Company, commonly known as Disney is a diversified multinational mass media and entertainment conglomerate with headquarters at the Walt Disney Studios complex in California. In addition to this, Disney owns a massive cruise line, the Pixar, Marvel, and Lucasfilm movie studios, the ABC and ESPN television networks, and the Hulu, ESPN+, and Disney+ streaming services.
Other best low-risk investments in US
1. Savings bonds.
Like savings accounts, U.S. savings bonds aren’t investments, strictly speaking. Why would you invest in Savings bonds? The Series EE savings bonds pay interest up to 30 years, and they earn a fixed rate of return if they were issued in May 2005 or after. If a U.S. savings bond is redeemed before five years, a penalty of the last three months’ interest is charged.
2. Money market funds.
Money market funds are pools of CDs, short-term bonds and other low-risk investments grouped together to diversify risk, and are typically sold by brokerage firms and mutual fund companies. Why invest in Money market funds? Unlike a CD, a money market fund is liquid, which means you typically can take out your funds at any time without being penalized.
3. High-yield savings accounts.
A savings account is completely safe in the sense that you’ll never lose money. Most accounts are government-insured up to $250,000 per account type per bank, so you’ll be compensated even if the financial institution fails. While not technically an investment, savings accounts offer a modest return on your money. You’ll find the highest-yielding options by searching online, and you can get a bit more yield if you’re willing to check out the rate tables and shop around.
4. Certificates of deposit
Bank CDs are always loss-proof in an FDIC-backed account, unless you take the money out early. To find the best rates, you’ll want to shop around online and compare what banks offer. If you leave the CD intact until the term ends the bank promises to pay you a set rate of interest over the specified term.
5. Treasury bills, notes, bonds and TIPS.
The U.S. Treasury also issues Treasury bills, Treasury notes, Treasury bonds and Treasury inflation-protected securities, or TIPS: TIPS are securities whose principal value goes up or down depending on the direction of inflation. All of these are highly liquid securities that can be bought and sold either directly or through mutual funds.
- Treasury bills mature in one year or sooner.
- Treasury bonds mature up to 30 years.
- Treasury notes stretch out up to 10 years.
6. Dividend-paying stocks
Stocks aren’t as safe as cash, savings accounts or government debt, but they’re generally less risky than high-fliers like options or futures. Dividend stocks are considered safer than high-growth stocks, because they pay cash dividends, helping to limit their volatility but not eliminating it. So dividend stocks will fluctuate with the market but may not fall as far when the market is depressed.
7. Preferred stocks.
Preferred stocks are more like lower-grade bonds than common stocks. Still, their values may fluctuate substantially if the market falls or if interest rates rise. Why you should invest in stocks? Like a bond, preferred stock makes a regular cash payout. But, unusually, companies that issue preferred stock may be able to suspend the dividend in some circumstances, though often the company has to make up any missed payments. And the company has to pay dividends on preferred stock before dividends can be paid to common stockholders.
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