For example, hedge funds have 3.8 times more net cyclical exposure to defensive stocks, down from 4.7 times in January, according to Jon Kinderlerer, a managing director at Credit Suisse.

Investors interested in going the conservative route can consider the PowerShares S&P 500 Low Volatility Portfolio (NYSEArca: SPLV) and the iShares MSCI USA Minimum Volatility ETF (NYSEArca: USMV), the two largest low volatility ETFs. [Use High Quality, Low Volatility ETFs to Fight Retail Sector Weakness]

USMV factors in how stocks interact with one another, weights each sector within 5 percentage points of the parent index and leans toward stocks that generate relatively stable earnings and are less sensitive to the business cycle than the broader market. SPVL, on the other hand, picks out the 100 least volatile stocks from the S&P 500. Both ETFs lean toward defensive sectors – SPLV includes 23.6% weight in utilities, 8.1% in health care and 16.3% in consumer staples while USMV has 16.5% in consumer staples, 18.2% in health care and 8.1% in utilities. [Get Defensive with Low Volatility ETFs]

For more information on market volatility, visit our volatility category.

Max Chen contributed to this article.