Invesco PowerShares is preparing more low-volatility exchange traded funds, which have been a hit with investors seeking equity exposure with less risk.
S&P Dow Jones Indices recently launched the S&P MidCap 400 Low Volatility Index and the S&P SmallCap 600 Low Volatility Index. [Are Dividend and Low-Volatility ETFs Redundant?]
The benchmarks are designed to measure the performance of the least volatile stocks within their market segments. [Low-Volatility ETFs Help Limit Downside Risk]
Both indices have been licensed to Invesco PowerShares for the creation of ETFs. The firm manages the $2.8 billion PowerShares S&P 500 Low Volatility Portfolio (NYSEArca: SPLV), the oldest and largest low-volatility ETF. [Low-Volatility and Dividend ETFs for Yield]
SPLV’s tracking index consists of the 100 stocks from the S&P 500 with the lowest realized volatility over the past 12 months.
“The simple construction of the indices has resonated with investors,” says Vinit Srivastava, director of strategy indices at S&P Dow Jones Indices.
Vanguard’s incoming chief investment officer recently said the asset manager is considering launching its own low-volatility ETFs. [Vanguard Mulls Low-Volatility ETFs as Category Thrives]
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