High-Beta vs. Low-Volatility ETFs

Also, the more cyclical sectors of the market have been leading the way during the “risk-on” rally.

Not surprisingly, the low-volatility and high-beta ETFs have radically different sector allocations.

SPLV, the low-volatility ETF, focuses on traditionally defensive sectors. It has 24% in consumer staples and 31% in utilities.

Meanwhile, SPHB has relatively higher stakes in more aggressive, cyclical sectors. The high-beta fund has 25% in financials, 21% in information technology, 13% in consumer discretionary and 19% in energy.

PowerShares S&P 500 High Beta

Full disclosure: Tom Lydon’s clients own SPY.