Is it the Right Time to Invest in Minimum Volatility ETFs?
Zacks Investment Research | May 22, 2020 02:27AM ET
The coronavirus continues to spread across the United States, with at least 1.5 million cases confirmed and the death toll rising to more than 94,000, according to Johns Hopkins University. However, almost all U.S. states have begun the process of reopening and easing of social distancing norms.
The outbreak has caused an unprecedented collapse of economic activities as governments are forced to shut down commerce and implement social distancing measures in an effort to contain the spread of the virus. The job market is also getting disrupted as Americans are consistently filing claims for unemployment benefits. Going by the latest Labor Department report, additional 2.4 million people filed for unemployment benefits in the last week, bringing the total number of filings during the coronavirus outbreak to more than 38 million, per a CNBC article. Also, touching the highest level on record, the number of continuing claims stands at 25.07 million.
Investors also seem to be worried about the simmering U.S.-China tensions. Amid arguments with China regarding its role in controlling the coronavirus pandemic, this time the tussle is about China’s move to impose new national-security laws on Hong Kong, per a MarketWatch report. In this regard, lawmakers in the United States have approved a bill with the aim to censure China’s latest move. Moreover, the Senate has passed a separate legislation that could result in Chinese companies being barred from listing on U.S. stock exchanges, per a Bloomberg report.
Minimum Volatility ETFs for a Healthy Portfolio
Low-volatility products could be intriguing choices for those who want to stay invested in equities during turbulent market conditions. The following options are intriguing:
iShares Edge MSCI (NYSE:MSCI) Min Vol USA ETF SPHD
The fund seeks investment results that generally correspond (before fees and expenses) to the price and yield of the S&P 500 Low Volatility High Dividend Index. It holds 50 securities. The fund has AUM of $2.39 billion and charges 30 bps in annual fees. It has a Medium risk outlook.
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