: The AB US Low Volatility Equity ETF focuses on low-volatility stocks, particularly in the technology sector. It has top holdings in Microsoft, Apple, and Alphabet, which are considered megacap winners. Despite September’s volatility and challenges to the Big Tech trade, Alliance Bernstein remains optimistic about the performance of this low-volatility ETF.
Noel Archard, the global head of ETFs and investor solutions at Alliance Bernstein, emphasizes the importance of investing broadly beyond just technology stocks. While technology plays a significant role in our daily lives, there are other industries worth considering for investment opportunities. Archard believes that historically less volatile sectors like consumer staples and financials can help mitigate risk and provide stability in a portfolio.
In comparison to other low-volatility ETFs, the AB US Low Volatility Equity ETF holds more tech-heavy stocks rather than traditionally stable companies. For instance, Invesco’s Low Volatility ETF has holdings in companies like Berkshire-Hathaway, Coca-Cola, and Visa. However, Archard argues that there is still room for tech stocks in a low-volatility portfolio, especially since technology continues to drive innovation and growth in various industries.
Despite the recent market volatility, the AB US Low Volatility ETF has performed well, with a 16% increase year-to-date as of Wednesday’s close. This strong performance suggests that low-volatility stocks, particularly in the tech sector, can be a reliable option for investors seeking stability and growth potential. By including stocks like Procter & Gamble and Fiserv in its portfolio, the ETF aims to provide a balanced mix of stable and growth-oriented investments.
Archard emphasizes the importance of addressing volatility in investment strategies, as it can have a significant impact on portfolio performance. While low-volatility stocks may not generate high returns during bull markets, they can help protect investors during market downturns. By diversifying across industries and sectors, investors can build a resilient portfolio that can weather market fluctuations and deliver consistent returns over the long term.
Overall, the AB US Low Volatility Equity ETF stands out as a strong investment option for investors looking to navigate the current market volatility. With a focus on low-volatility tech stocks and a diversified portfolio that includes stable sectors, the ETF offers a balanced approach to investing that can help investors achieve their long-term financial goals while managing risk effectively.
