The S&P 500 High Beta Index is made up of 100 securities from the S&P 500 Index that have the highest sensitivity to market movements, or “beta,” over the past 12 months – beta is a measure of relative risk and is the rate of change of a security’s price.
The low vol/high beta index has been outperforming the broader S&P 500 index. According to S&P Indices data, the Lunt Capital US Large Cap Equity Rotation Total Return Index has increased 9.1% year-to-date and generated an average annualized return of 19.4% over the past five years.
SEE MORE: Look to a High Beta ETF Strategy for a Risk-On Environment
ETF investors should be familiar with the two sub-indices as the S&P 500 Low Volatility Index and S&P 500 High Beta Index are the underlying benchmarks for the two popular PowerShares S&P 500 Low Volatility Portfolio (NYSEArca: SPLV) and PowerShares S&P 500 High Beta Portolio (NYSEArca: SPHB), respectively.
For more information on new fund products, visit our new ETFs category.