The low volatility effect: Pursuing a smoother investment experience

Over the long term, low volatility portfolios outperform the market on a risk-adjusted basis, with less volatility, while protecting on the downside.

Given the potential for a soft or hard landing in most developed markets globally, and with inflation at its highest since the 1980s, it’s important to assess how low volatility investments perform in these types of market environments. We’ll illustrate how low volatility portfolios outperform during inflationary environments and show how they outperform in both slowdown phases and recessions with higher risk-adjusted returns in all applicable market environments.

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