Market segments will perform differently during various economic cycles, and as the U.S. may be heading toward the late business cycle, exchange traded fund investors should consider which areas could drive returns or increase portfolio risks. While low-volatility exchange traded funds may not outperform in a strong bull rally over the short-term, the strategy’s ability to hedge downside risk may be worth it over the long run.

“It’s been about one year since the 2016 election, when equities really started rallying. During that time, the Low Volatility ETF has returned a total of 18% compared to a 23% return for the S&P 500. Again, that’s not surprising given that the growth style has significantly outperformed value. What is surprising is the risk profile of both the fund and the S&P 500 over that time,” reports ETF Daily News.

With investors favoring the growth and momentum factors and related cyclical sectors this year, SPLV has seen year-to-date outflows of $28.5 million.

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