A defensive holding is Mead Johnson Nutrition (MJN), maker of Enfamil baby formula. The company has been expanding in China, Latin America and other emerging markets.
"Consumers in emerging markets are willing to pay a big premium for high-quality Western brands," says Blum.
A stock that can climb when the economy grows is Schlumberger (SLB), the oilfield services giant. Blum says that as companies seek to obtain oil in hard-to-reach locations, the demand is growing for equipment and services. Schlumberger ranks as a superior competitor because it offers the technological advantages that major oil companies seek.
New America Growth
Another steady fund is T. Rowe Price New America Growth, which has returned 5.9% annually during the past five years, outdoing 93% of competitors. Portfolio manager Joseph Milano seeks high-quality companies that are gaining market share. His portfolio includes a mix of fast growers and steady performers with slower growth rates. During 2008, the fund outdid 67% of competitors, and it topped 92% in 2009.A holding is United Parcel Service (UPS). Milano says that UPS has a strong balance sheet and can increase earnings at a double-digit rate. The company is gaining a more dominant position as corporations develop increasingly complicated global supply chains. The shares sell at bargain levels, he argues. "The stock has been weak because people are nervous about the possibility of heading into a recession," Milano says. "But UPS would do fairly well in a recession, and it would participate nicely if the economy grows." He also likes eBay (EBAY), which operates PayPal, the dominant provider of online payment systems. PayPal is growing steadily. After a period of mixed results, the company's online retailing business is improving, says Milano.