Quantcast
The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:Rekenthaler: Be Cautious About Low Volatility Stocks and Bonds Not Rated 0.0 Email Routing List Email & Route  Print Print
Friday, June 14, 2013

Rekenthaler: Be Cautious About Low Volatility Stocks and Bonds

News summary by MFWire's editors

Institutional money managers and a few retail funds have created low volatility portfolios because they know investors will accept lower profits for greater safety, but Morningstar's Rekenthaler says these portfolios have their flaws.

1) Lower volatility does not lead to decreased performance, he writes. US equity funds with average standard deviations show best aggregate gains, while those with lowest and highest risk land at bottom. With funds owning foreign equities the effect is more in favor of low-risk funds as they have the best performance.

Rekenthaler says you have to look at risk too. Using ECVaR--excess conditional value-at-risk-- mutual funds line up according to standard investment theory.

2) Rate sensitivity is another issue. Stocks that register low volatility could share something else in common, and if that something runs into trouble, so will the low volatility stocks. 

Edited by: Casey Quinlan


Stay ahead of the news ... Sign up for our email alerts now
CLICK HERE

0.0
 Do You Recommend This Story?



GO TO: MFWire
Return to Top
 News Archives
2024: Q2Q1
2023: Q4Q3Q2Q1
2022: Q4Q3Q2Q1
2021: Q4Q3Q2Q1
2020: Q4Q3Q2Q1
2019: Q4Q3Q2Q1
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Raw XML
Add to My Yahoo!
follow us in feedly




©All rights reserved to InvestmentWires, Inc. 1997-2024
14 Wall Street | 20th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use