Which firms would you expect to have greater market risk?

Question

Which firms of each pair below would you expect to have greater market risk?
General Steel or General Food Supplies.
Club Med or General Cinemas.

Answer 1

General Steel. In good times, both companies will do well. In tough times, there will be less construction requiring steel products but everybody's got to eat.

For the same reason, Club Med. Fewer people will be able to afford a Club Med vacation, but anybody can afford to go to the movies occasionally. In fact, during times of recession, film attendance actually rises as other forms of entertainment are less affordable.