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Defensive shares are shares in companies that do well even when the economy does not, things that people always need, no matter how much money they have - companies that produce pharmaceuticals, or food, or energy.

Shares may be divided into different categories, 'defensive' or 'cyclical', 'growth-' or 'income-'producing. These are based on the characteristics of certain kinds of company, what product or service it is offering, and whether it is more or less likely to be popular at certain times.

Cyclical shares do better or worse depending on how well the economy is doing. Think banks (which suffered loads during the recession when people started withdrawing their savings, or could not pay their mortgages) or clothes companies (fewer people buy a new outfit when they are worried about their job situation, but will have a splurge when they get a bonus at work).