The low volatility factor focuses on stocks exhibiting lower price fluctuations compared to the broader market. This approach is based on the observation that, contrary to traditional financial theory, low-volatility stocks have historically provided better risk-adjusted returns than high-volatility stocks over long periods. This phenomenon, known as the “low-volatility anomaly,” challenges the conventional wisdom that higher risk should be rewarded with higher returns. The strategy is particularly appealing to risk-averse investors seeking more stable returns and downside protection during market turbulence.
We looked at the stocks that are currently in the bottom 10% of our database based on their volatility (measured by a combination of standard deviation and beta) and identified the top 10 that have the highest scores using our guru models, which are based on the strategies of historically successful investors like Warren Buffett, Peter Lynch and Martin Zweig.
Here are the current top 10 low volatility stocks.
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