How to win with economically insensitive stocks

Commodity prices, particularly energy prices are a new unwelcome tax on world growth, says Stephen Wood from Eiger Capital. He says governments and central banks are cognisant of the need to move back to lower deficits and less monetary support. As a result, growth is likely to struggle and Stephen says we may have to wait 6 months to make sure inflation will start to fall. So, how is this likely to affect your share portfolio? Stephen says that Eiger capital is of the opinion that stocks that have struggled to grow over the past few years, which rely on underlying economic growth, are still going to struggle. In other words, those classic value stocks are not going to work, just when you thought they might. Stephen's way of playing this is to stick with high return, structural growth small caps, with a hint of the COVID re-opening benefit or stocks that are economically insensitive. Stephen's picks include Life 360, which he says is a big beneficiary of kids out and about. It's business accelerated during COVID and he sees no reason why it will slow down from here. Stephen also likes Integral Diagnostics, which is a medical imaging business. He says COVID has impacted its results, but with elective surgery, that is economically insensitive, opening up Stephen says Integral Diagnostics stands to benefit from the big backlog of demand.