Daily Archives: Jul 14, 2017 at 07:25 am EST

Low-Volatility Stocks Are Having A Rough Summer

Stocks that exhibit low volatility are prized as a risk factor that’s expected to beat the broad market over time with a smoother rise, according to academic research and countless backtests. Real-world returns, however, reflect mixed results in recent years, based on representative ETFs. Meanwhile, some analysts have been warning in recent months that low-vol stocks climbed too far too fast and are vulnerable to a correction. The warning carries more weight these days in the wake of low vol’s stumble relative to equities generally and other factor strategies.
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