Bucking the trend

The market has fallen dramatically over the last week, although there are some shares that have weathered the storm and even increased over this time. If your portfolio holds these shares, you’ll be among the best investors in the country. We look at the strong companies on the ASX that have gained ground and a few others which have still beaten the market in this tumultuous week.

Similar to the storm which lashed Sydney earlier this week and saw residents walking outside the next day to find many trees down and wondering why some were spared, the ASX has a few green trees still standing strong against the current overbearing negative influences on the market.

Often when the market first falls, the leaders fall the hardest. This is because they’re the companies that have run the hardest and have the highest expectations.

If the market continues to fall, a separation occurs. The companies which still provide great growth prospects stop falling, hold their ground and show more resilience than the market. These companies may even start to climb back towards their highs. Then, as the market bottoms and turns the corner, these companies shoot up much higher than the market and resume their strong advance. These companies often become the leaders of the next market cycle.

The first step in identifying the leaders of the next market cycle is finding the companies which are bucking the trend of the downward market. Here is a list of the companies which have stood strong and gained ground this week.

To take the list one step further, we can see that there are some strong companies which have beaten the market this week as well as the last 12 months. Interestingly, this group is well represented by Property companies (AREITs / LPTs), Utilities and Health Care companies.