Self Directed Investor Inc
SDI: "Empowering investors with ideas and education"
Symbol Lookup »  
Topics:ChinaETFsEarningsEconomyEnergyForexGoldIncomeLessonsIdeasTrading

  • Other news: News from PR Newswire
| More

High and Low Volatility ETPs

Wed, Dec 14, 1:11 PM ET, by Bill Luby

Since Barclays/iShares launched the first VIX-based exchange-traded products (ETPs) three years ago next month, the landscape of volatility ETPs has been dominated by products that are based on VIX futures. This should come as no surprise to investors, since the cash VIX (or VIX index quoted on CNBC and elsewhere) cannot be traded directly.

In early May, however, PowerShares elected to go in a different direction and launched the PowerShares S&P 500 Low Volatility Portfolio (SPLV) on one end of the spectrum and the PowerShares S&P 500 High Beta Portfolio (SPHB) at the more volatile end of the spectrum. [I'm guessing that a "High Volatility" moniker didn't make it very far with either the legal or marketing folks"]

Three weeks after the PowerShares products, Russell Investments peppered the market with a launch of ten different "factor ETFs" which also address investor demand for products with high and low volatility, beta, momentum, etc. over the Russell 2000 and Russell 1000 universe, later followed by three international variants. Since then, several other issuers have entered the market with similar products.

By far the products that have received the most attention from investors have been the low volatility ETPs, with SPLV leading the pack with a market share of around 80%.

So far these volatility/beta ETPs have attracted approximately $800 million in assets, about 1/3 of the amount that is invested in VIX-based ETPs.

While the low volatility products have performed quite well since their launch and I understand the visceral desire to hold low volatility products in a high volatility world, as I see it, holding low beta stocks (SPLV top holdings) is just another way at market timing and not necessarily better over the long haul than diversifying with bonds or even more cash.

Going forward, I will spend some time analyzing the performance of SPLV, SPHB and some other ETPs in the volatility/beta group. In the meantime, give some thought to the possibility that even though utilities (XLU) have been superb performers in 2011, these are not necessarily the best long-term investments for most of us.

Disclosure(s): none



SDI Glossary: "Beta" Definition
SDI Glossary: "ETFs" Definition
SDI Glossary: "iShares" Definition
SDI Glossary: "VIX" Definition
This Article's Word Cloud:   CNBC   ETPs   High   Investments   Portfolio   PowerShares   Russell   SPHB   SPLV   Since   Volatility   adsbygoogle   also   another   based   been   beta   better   cash   come   didn   different   entered   even   give   have   high   investors   launch   launched   long   market   million   moniker   more   most   necessarily   other   over   products   since   some   spectrum   that   these   three   traded   volatility   which   with

| More

How Other Markets Behaved while Stocks Surged Feb 22
Wed, Feb 22, 2:11 PM ET, by Corey Rosenbloom

It’s easy to be distracted by shiny objects, like the non-stop stock market rally since ...

New Highs as Far as the Eye Can See (for now) Feb 22
Wed, Feb 22, 11:21 AM ET, by Corey Rosenbloom

It’s rare to see broad market impulses this strong and persistent but yet here we ...

SPX 1, 2 and 3-Year Returns Following Top and Bottom Five (and Ten) VIX Average Annual Readings
Tue, Feb 21, 8:11 AM ET, by Bill Luby

On Saturday, I posted Putting Low Stock Volatility to Good Use (Guest Columnist at Barron's) ...

Putting Low Stock Volatility to Good Use (Guest Columnist at Barron's)
Sat, Feb 18, 5:21 PM ET, by Bill Luby

With spring training just getting underway in Florida and Arizona, I think it is appropriate ...

March Class Special: Detecting Tradable Setups and Reliable Signals with Corey
Thu, Feb 16, 12:11 PM ET, by Corey Rosenbloom

I’m excited to announce an upcoming full-month of classes and actionable trader education for you ...

We Forgot what a Pullback Was Market Update Feb 16
Thu, Feb 16, 11:11 AM ET, by Corey Rosenbloom

Wait – what is this? Price can actually go DOWN? After the last five days, ...

Bulls Still Dominate the Highs Feb 15
Wed, Feb 15, 1:31 PM ET, by Corey Rosenbloom

The uptrend continues! And continues… and continues. And still continues even after yesterday’s pullback. ...

Six Stellar Stocks Shooting Straight Up Nine Days in a Row
Tue, Feb 14, 8:31 PM ET, by Corey Rosenbloom

When we scan for stocks, we like to find “strong stocks getting stronger.” One way ...

Market Internals and the New Pullback from the Highs Feb 14
Tue, Feb 14, 11:41 AM ET, by Corey Rosenbloom

The uptrend continues! And continues… and continues. Until today’s pullback at least. ...

New Introduction to the Wave Principle Video
Fri, Feb 10, 5:51 PM ET, by Corey Rosenbloom

If you’ve never heard of the Elliott Wave Principle, or want a quick intro-level refresher, ...

Time for a Longer Timeframe Bounce for Coca Cola KO
Fri, Feb 10, 10:11 AM ET, by Corey Rosenbloom

Let’s see if buyers can take advantage of a long term rising trendline for Coca-Cola ...

Tesla TSLA Surges with Market on Break to New Highs (but Watch the Weekly Chart)
Thu, Feb 9, 3:41 PM ET, by Corey Rosenbloom

Tesla (TSLA) shares continued their strong uptrend, breaking out to a new swing high this ...

Breaking Out to New Highs Feb 9
Thu, Feb 9, 12:21 PM ET, by Corey Rosenbloom

The uptrend continues! And continues… and continues. Today we’re seeing another breakout to new highs ...

Gilead Sciences GILD Collapses to Keep Steep Downtrend in Motion
Wed, Feb 8, 4:11 PM ET, by Corey Rosenbloom

“Strong Stocks Keep Getting Stronger while Weak Stocks Keep Getting Weaker.” Gilead Sciences reminds us ...

Keeping the Range Going at the Highs Feb 8
Wed, Feb 8, 12:51 PM ET, by Corey Rosenbloom

We’re seeing a series of small ranges develop in the @ES Emini. Today gave us ...

Pullback Planning for Disney DIS Ahead of Earnings
Tue, Feb 7, 3:11 PM ET, by Corey Rosenbloom

Disney (DIS) reports earnings after the closing bell today. Let’s study the set-up – a ...

Strong Stock Getting Stronger NVDA Rallies its Way Back to the Highs
Mon, Feb 6, 1:41 PM ET, by Corey Rosenbloom

Each week for members, I publish the results of a “Strong Stock Getting Stronger” stock ...

After a Nice Bear Flag BIDU Triggers a Bull Flag Breakout
Mon, Feb 6, 12:31 PM ET, by Corey Rosenbloom

If you like trading Bull and Bear Flags as I do, you’ll probably want to ...

Emini Pulling Back from the Highs Trade Planning Feb 6
Mon, Feb 6, 12:11 PM ET, by Corey Rosenbloom

Last week’s breakout sent the market back toward the prior high. However, this morning we’re ...

Market Surging Back to the Highs Update Feb 3
Fri, Feb 3, 12:51 PM ET, by Corey Rosenbloom

Jobs Jobs Jobs! A positive reaction to this morning’s monthly Jobs Report sent the market ...

Bouncing Between the New Range Emini Update Feb 2
Thu, Feb 2, 12:21 PM ET, by Corey Rosenbloom

The range is back! And we didn’t miss it at all. We’re seeing price bounce ...

Apple AAPL Appears Back at the Highs Feb 1
Wed, Feb 1, 1:31 PM ET, by Corey Rosenbloom

Just like that, Apple (AAPL) shares surged toward the price highs of early 2016. Will ...

February Fed Day Fibonacci Bouncing Update Feb 1
Wed, Feb 1, 12:41 PM ET, by Corey Rosenbloom

We’re using two Fibonacci Grids for planning trades in the intraday Emini as noted. Price ...

Day Two of Market Crashing to Support Jan 31
Tue, Jan 31, 12:31 PM ET, by Corey Rosenbloom

From the negative divergences in an overextended market, a pullback was precisely the expected future. ...

Swinging Toward and Away from the 20 Day EMA
Mon, Jan 30, 3:41 PM ET, by Corey Rosenbloom

When setting up your trades, it’s helpful to put them within the context of the ...

Crash Goes the Market to Lower Targets Jan 30
Mon, Jan 30, 1:11 PM ET, by Corey Rosenbloom

From the negative divergences in an overextended market, a pullback was precisely the expected future. ...

Four Market Money Flow during the Stock Market Surge Jan 27
Fri, Jan 27, 2:11 PM ET, by Corey Rosenbloom

We know that US Stocks surged to new all-time highs this week as the Dow ...

Pullback in Progress Market Update Jan 27
Fri, Jan 27, 12:51 PM ET, by Corey Rosenbloom

Down from the highs we go! At least temporarily. Yesterday we looked at our negative ...

Stepping Inside the Breakout with Internals Update Jan 25
Thu, Jan 26, 12:21 PM ET, by Corey Rosenbloom

How high will this breakout travel? Let’s take a moment to look beneath price to ...

The Breakout is Finally Happening Jan 25 Update
Wed, Jan 25, 11:21 AM ET, by Corey Rosenbloom

The market just became exciting again! After a month in a well-defined sideways trading range, ...

Comparing Creeper Uptrends Intraday Jan 24
Tue, Jan 24, 1:41 PM ET, by Corey Rosenbloom

Nobody wants to be a “Creeper” but as traders we certainty do enjoy “creeper” intraday ...

From the Low to the High of the Trading Range Jan 24
Tue, Jan 24, 12:51 PM ET, by Corey Rosenbloom

Trading the market is extraordinary easy right now – buy when price touches the lower ...

The Range is All that Matters Right Now Jan 23
Mon, Jan 23, 12:51 PM ET, by Corey Rosenbloom

Stop what you’re doing and look at the trading range. Now. ...

Pondering a Perfect Pattern Repeat for Market at the Highs
Fri, Jan 20, 1:21 PM ET, by Corey Rosenbloom

A major part of technical analysis (charting) is identifying prior patterns – and their outcomes ...

This is a Very Tight Range for Traders Emini Jan 20
Fri, Jan 20, 1:11 PM ET, by Corey Rosenbloom

Stop what you’re doing and look at the trading range. Take off all indicators and ...

No Breakout Not Today Emini Trading Update Jan 19
Thu, Jan 19, 12:11 PM ET, by Corey Rosenbloom

My heart goes out to you if you excitedly decided 2017 was the year you ...

High Flying Financial Goldman Sachs GS Falls from the Highs
Wed, Jan 18, 1:21 PM ET, by Corey Rosenbloom

Stocks that are high-flyers run the risk of crashing back to earth. Goldman Sachs (GS) ...

Range Range Here to Stay Emini Update Jan 18
Wed, Jan 18, 1:11 PM ET, by Corey Rosenbloom

If you’re ready for this trading range at the highs to end, you’re not alone. ...

Emini Down from the Highs Still within the Range Jan 17
Tue, Jan 17, 11:31 AM ET, by Corey Rosenbloom

In the battle for market dominance we still DON’T have a winner! Bulls? Bears? Still ...

Still Range Trading at the Highs January 13 Update
Fri, Jan 13, 1:21 PM ET, by Corey Rosenbloom

In the battle for market dominance we still DON’T have a winner! Bulls? Bears? Nada. ...

Volatility Returns to the Emini January 12
Thu, Jan 12, 1:31 PM ET, by Corey Rosenbloom

Buyers and sellers continue to struggle for dominance at the highs and right now neither ...

From the Highs Back to our First Fibonacci Level Jan 11
Wed, Jan 11, 2:11 PM ET, by Corey Rosenbloom

I always find it fascinating when price does exactly what it’s supposed to do – ...

Crude Oil Crushes Lower as Expected from Divergences
Tue, Jan 10, 6:51 PM ET, by Corey Rosenbloom

Crude Oil gives us a textbook example of a reversal pattern – with negative divergences ...

Hey Look at that Emini Range January 10
Tue, Jan 10, 3:11 PM ET, by Corey Rosenbloom

Bull Trap? Breakout? Both bulls and bears and fighting for dominance… and neither side is ...

Emini Playing Again at the Highs January 9
Mon, Jan 9, 1:41 PM ET, by Corey Rosenbloom

Monday morning may be the beginning of a “bull trap” should price remain under the ...

Through the Highs We Go January 6
Fri, Jan 6, 1:31 PM ET, by Corey Rosenbloom

Not to be outdone by this pesky sideways trading range, the stock market broke out ...

Something Strange in Sector Relative Strength Jan 5
Thu, Jan 5, 4:21 PM ET, by Corey Rosenbloom

What signal is money flow across sectors sending, and what’s strange about it? Let’s take ...

A New Emini Range at the Highs January 5
Thu, Jan 5, 2:31 PM ET, by Corey Rosenbloom

The market has a bullish beginning to 2017 but right now, we’re seeing a return ...

VIX ETPs Flash Some Green in 2016
Wed, Jan 4, 4:11 PM ET, by Bill Luby

Last year I shocked quite a few investors and media outlets with the publication of ...

Join Us Live TODAY to Plan your 2017 with Corey and Wyckoff Analytics
Wed, Jan 4, 1:21 PM ET, by Corey Rosenbloom

Let’s start 2017 on the right pathway! I’m honored to join Roman Bogomazov and Bruce ...

  More articles:  1 2 3 4 5 6 7 next »

ABOUT US »   ADVERTISE »   CONTACT US »   TERMS OF USE & PRIVACY POLICY »

High and Low Volatility ETPs | Self Directed Investor | Copyright © 2008 - 2017, All Rights Reserved

Any ideas and opinions presented in Self Directed Investor content are for informational and educational purposes only, and do not reflect the opinions of BNK Invest, Inc. or any of its affiliates, subsidiaries or partners. In no way should any content contained herein be interpreted to represent trading or investment advice. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All site visitors agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. Read Full Disclaimer.

SDI is associated with: ValueForum.com -- a subscription-based online social networking forum of serious individual investors. | MarketNewsVideo.com -- videos appearing on SDI are produced by Market News Video. | TickerTech.com -- stock quote content appearing on SDI is at least 20 minutes delayed and is powered by Ticker Technologies. | GoldStockStrategist.com -- Edited by Scott V. Nystrom, PhD, Gold Stock Strategist provides analysis on gold mining companies.