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10 Best Low Volatility ETFs To Buy

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In this article, we discuss 10 best low volatility ETFs to buy. If you want to skip our discussion on low volatility investments, head over to 5 Best Low Volatility ETFs To Buy

What is Low Volatility Investing?  

Low volatility investing refers to an investment strategy where a stock portfolio is less volatile in terms of price fluctuations compared to the broader market, offering a smoother investment experience. Rather than choosing only low-risk stocks, this strategy measures how stocks move relative to each other. The main objective of low volatility investment strategies is to lower overall portfolio risk. The best way to benefit from low volatility investments is to invest in minimum volatility ETFs, which serve as strategic investment vehicles with long-term asset allocation, allowing investors to mitigate risk successfully. Historically, minimum volatility indexes have indicated reduced volatility compared to broader market indices.

Betting against sudden changes in currency values has become very profitable in the financial world. Many big firms on Wall Street are seeing that their clients are no longer making bets against the market and believe that markets will remain stable. This is a big change in the market where currencies are traded, which is worth a whopping $7.5 trillion-a-day. The ups and downs in currency values that traders used to make money from are mostly gone now, as computer programs make bets that markets will stay calm. This is making lots of money for those anticipating minimal market swings. Henry Drysdale, head of currency options trading at NatWest Markets in London, told Bloomberg

“The emergence and dominance of systematic volatility selling funds is a bit self-fulfilling. If the strategy is successful, more enter the space and it gets quite crowded, with more and more participants selling volatility at lower and lower levels.”

Similarly, traders are making bets that raw materials prices will remain stable, going against the historical pattern of sharp ups and downs in the commodity sector. Different factors have contributed to the stagnation of commodity prices in recent months. For example, the oil market has been constrained by OPEC+ production cuts and ample spare capacity, while copper prices are influenced by growing demand from renewable energy sources alongside challenges in traditional consumption sectors. Gas volatility has returned to pre-crisis levels in Europe. This trend reflects a broader pattern in global markets, where investors are betting against significant price swings. With equity markets trending upwards and substantial investments pouring into ETFs focused on maintaining market stability, macro-level volatility has decreased. According to Jo Harmendjian, portfolio manager at Tiberius Group AG: