The financial crisis “is one of those for events for investors that lived through that, it’s going to be part of their psyche for the rest of their lives,” said Feyerer. “When you look at the math involved from digging out from significant portfolio drawndowns, you start to look as a low volatility strategy as a core portfolio holding.”
Investors look to use a low volatility ETF as a core holding while generating income can turn to the PowerShares S&P 500 High Dividend Portfolio (NYSEArca: SPHD), “is composed of 50 securities traded on the S&P 500 Index that historically have provided high dividend yields and low volatility,” according to PowerShares. The ETF has a trailing 12-month yield of 3.33%.
Like SPLV, SPHD pays a monthly dividend. Utilities, financials and consumer staples combine for nearly 56% of the fund’s weight. The ETF has added more than $440 million in new assets over the past year. [The Right Dividend ETF for the Times]
This year, PowerShares has added to its low volatility lineup with the introductions of the PowerShares ex- Rate Sensitive Low Volatility Portfolio (NYSEArca: XRLV) and the PowerShares Europe Currency Hedged Low Volatility Portfolio (NYSEArca: FXEU).