As we wrap up Pacific Wealth, we also want to address our legacy holdings from the old Australian Edge. Needless to say, many of them have taken a beating as growth in Asia has been slowing, particularly in China, and the prices of everything from oil and natural gas, to iron ore and copper, have been under pressure. And while Australia is an advanced economy encompassing everything from financials to electronics, it is still a very resource-dependent country.

Given that weakness, the point of this article is to let you know what we believe you should sell outright and what Australian stocks we believe are worth holding onto. If we don’t address a particular holding specifically, it is one that we think will do okay in the grand scheme of things but isn’t one of our favorites.

And our least favorites right now are in the energy sector, which investors would be wise to avoid given the volatility in energy prices. The price of a barrel of American oil has plunged from $115 in June of last year to as low as $42 in August, and has averaged only about $45 in September here in the U.S. The picture isn’t much better globally as Brent crude has fallen from nearly $100 a barrel a year ago to only about $48 today.

While oil prices are predicted to rise next year, it isn’t by much. Brent crude oil is expected to average about $58 a barrel next year, with American West Texas Intermediate crude expected to fetch just $54. While higher cost production, such as drilling activity in our own oil shales, has showed some signs of slowing down, analysts predict that oil supplies might still rise if economic sanctions are lifted on Iran.

At the same time a slowing Chinese economy and the resultant drag on global economic growth that would produce is likely to dent energy demand further. So there little reason to expect oil prices to find much support in the short-term.

In the old Australian Edge Aggressive portfolio, shares of both WorleyParsons and Cardno have seen their values more than halved over the past year, mostly thanks to the steep dive in energy prices. While both provide engineering and environmental services to companies outside of the energy sector, with Cardno (ASX: CDD/OTC: COLDF) in particular doing a fair bit of infrastructure work, both count energy companies as their biggest client base. But as prices have fallen, energy companies have been cutting their capital expenditures and retrenching to survive the decline.

That’s more than dinging revenue at both companies and while their backlogs have grown, they have been slow to translate into additional work as projects have been postponed.

With little reason to expect a turnaround in energy prices any time soon, both WorleyParsons (ASX: WOR/OTC: WYGPF) and Cardno are sells.

While Woodside Petroleum has fared significantly better during the recent downturn in energy prices thanks to its significantly lower cost base, we don’t look for its shares to make stage a turnaround any time soon, either.

Thanks to the fact that it was one of the first major players in Australia’s energy industry, its basic infrastructure was put into place at a much lower cost than most of its competitors. It has also benefited from the fact that it has long-term take-off agreements with major energy consumers in Asia, essentially obligation some of Asia’s largest utilities to purchase its production. That’s helped Woodside (ASX: WPL/OTC: WOPEF) consistently boost both production and revenue during this weak period, but it hasn’t entirely offset falling prices.

Sell Woodside Petroleum.

The news isn’t all bad out of Australia, though. While it is one of our lower yielders at 3.9%, shares of Sydney Airport continue to march higher thanks to growing Australian tourism.

Owning the lease to operate Sydney Airport until 2097, the country’s busiest with around 38 million passengers passing through it each year, Sydney Airport (ASX: SYD/OTC: SYDDF) collects what amounts to a toll for each passenger flying through. Thanks to its monopoly, it is able to sustain a high payout ratio and carry an amount of debt which would be uncomfortable for any other company. But traffic through the airport has grown by more than 50% over the past decade, with the volume of international travelers up 5.2% last month alone.

While low energy prices have turned us off oil and gas producers, they are actually helping the airline industry thanks to lower fuel prices. That, in turn, is keeping airfares down and boosting tourism to Australia. The weak Australian dollar is also making it an attractive destination for foreign visitors.

That growth should continue for some time to come, so Sydney Airport remains a buy on dips under $4.25

Despite the bump in Australian tourism, shares of casino operator Crown Resorts have been drifting down over the past year. The main reason is that a joint venture it embarked on to operate three casinos in Macau has come under pressure as authorities there are cracking down on money laundering and corruption. As a result, earnings at the joint venture are expected to be cut in half.

Crown (ASX: CWN/OTC: CWLDF) is still the largest casino operator in Australia, plus it has development deals to open a new casino in Las Vegas by 2018, as well as new casinos in the Philippines and Sydney, Australia. So while Macau may be a drag on earnings for now, the casino operators’ fortunes should turn around with plenty of attractive growth ahead of it.

Crown Resorts remains a buy under $15.

We also continue to like industries which cater to our basic needs, and there isn’t a need more basic then to eat.

GrainCorp, with a 1.4% yield, operates quite a bit of the grain handling capacity along Australia’s east coast, moving things like wheat and barley from place to place, storing it and loading it onto ships. It is also the fourth-largest producer of malt in the world, a key ingredient in beer production, and the second-largest oil seed crusher in Australia.

Revenue and earnings at GrainCorp (ASX: GNC/OTC: GRCLF) can be somewhat choppy because, while it doesn’t actually grow the grains itself, bad production years mean less grain to move. Still, it has worked to diversify its revenue base with the introduction of milling and malt production and, given its large position in the Australian grain market, isn’t likely to go anywhere soon. It also continues to buy up smaller competitors, further entrenching itself in the grain logistics market.

While there will always a seasonality factor in the grain business, global demand for grain is only going to grow. And thanks to its proximity to Asian markets, Australia will likely always be a major supplier, making GrainCorp extremely attractive.

Helping to supply grain to some of the world’s hungriest regions, GrainCorp is still a buy under $10.

Given that it is less focused on the commodities generally and the energy sector specifically, the holdings in the Conservative Portfolio have held up quite well over the past year, with most posting respectable gains. However, with Australia’s economy continuing to slow, some are likely to come under pressure.

With the unemployment rate in Australia currently at 6.2%, most forecasters believe that figure is likely to move higher. Mining investment in the country is on the decline, creating fewer new jobs and even leading to layoffs as miners focus more on improving efficiency. That is expected to have the knock-on effect of slowing housing construction, which most expect to begin dipping next year. At this point, there’s little confidence that economic growth and job creation will pick up any time soon.

That’s by no means welcome news for GPT Group (ASX: GPT/OTC: GPTGF), an Australian real estate investment trust which owns a portfolio of retail, office and logistics properties. Unfortunately, it has a number of major tenants whose leases will be coming up for renewal over the next two years, just as the nation’s economy continues to slow. It is expected that those tenants are at the very least going to push for lower lease rates, especially since in many cases their rents are quite high after the Australian property boom over the past few years. That could offset any boost from a rate cut by the Reserve Bank of Australia, which would lower the REITs borrowing costs.

Stockland (ASX: SGP/OTC: STKAF), our other REIT holding in the portfolio, is a bit better diversified so it might not come under quite as much pressure as GPT Group. In addition to its portfolio of retail, office and industrial properties, it also holds residential properties and retirement communities. Again though, if the Australian economy continues to slow, Stockland will also come under pressure.

Sell both Stockland and GPT Group.

While we are concerned about Australia’s property market, we remain positive on its healthcare companies, especially CSL Limited.

One of the three largest global companies involved in bio-therapeutics, or drugs derived from compounds that naturally occur in human blood, its medicines are used to treat a host of rare and, in many cases, potentially fatal diseases. Given the complexity of its products and tight government regulation of their production, new competition isn’t likely to emerge for its products. And no matter what the state of the economy is, patients suffering from hemophilia and other diseases will continue buying CSL’s (ASX: CSL/OTC: CMXHF) products.

Given the dependence of patients on its products, CSL Limited is a good buy under $69.

We also continue to like M2 Telecommunications Group, a major Australian telecom that mainly serves customers in the country’s urban centers. With 1.4 million connections, the company offers both fixed-line and mobile phone services, as well as broadband access.

M2 (ASX: MTU/OTC: MTCZF) uses an interesting infrastructure-light model, meaning it primarily relies on third-party networks for its services. As a result, its capital expenditures are nowhere near as high as a traditional telecom, allowing it to generate substantial free cash flow. In turn, that allows the company to maintain a high payout ratio averaging about 90% of earnings and drive consistent dividend growth.

M2 Telecommuncations group is a bargain under $9.

We also continue to like Australian utility AGL Group. The oldest company listed on the Australian Stock Exchange, it serves nearly 4 million gas and electricity customers in eastern and southern Australia. While its growth would likely slow along with the economy, given the necessity of its products earnings shouldn’t take a substantial hit. It also benefits from carrying very little debt, so it shouldn’t find itself in a cash crunch regardless of what happens with the economy.

Given the defensive nature of utilities and its solid 4.2% dividend, AGL Group (ASX: AGK/OTC: AGLNF) remains a buy under $12.