You pulled out of the stock market because it just got too scary last year. Now you’re thinking about reinvesting, but you’re afraid that the economic situation will be really ugly. It’s kind of like Dorothy’s Lion, you want to go to Oz but you’re afraid of the Wicked Witch (i.e. recession).
I would recommend that you stick to stocks that can weather almost any kind of recession. Grocery stories, all kinds of utilities, health care providers, and funeral services to name a few. Regardless of how deep a recession we have, people will still, eat, heat and cool their homes, go to the doctor and (when that doesn’t work) pass away.
Two cautions. First, carefully look at their debt situation. Regardless of the industry, if they have mountains of debt coming due they may have trouble refinancing that debt. Second, don’t expect these stocks to go up 1000% when the economy recovers. Generally these stocks haven’t really fallen dramatically, and won’t get the same move up when things turn around. But if you want some equity exposure without too much risk, CLS (Cowardly Lion Stocks, you saw the acronym here first) may be the way to go.