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For investors seeking momentum, iShares Edge MSCI Min Vol USA ETF (USMV - Free Report) is probably on radar. The fund just hit a 52-week high, and is up 23.5% from its 52-week low price of $60.93 per share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
USMV in Focus
This product offers exposure to stocks having lower volatility characteristics than the broader U.S. equity market. It has key holdings in information technology, healthcare, communication and consumer staples. The ETF charges investors 15 basis points a year in fees (see: all the Large Cap ETF Blend here).
Why the Move?
The low-volatility corner of the broader market has been an area to watch lately, given inflation fears and resumption of global growth worries with the rise in delta variant. These products have the potential to outpace the broader market in bearish conditions or in an uncertain environment, providing significant protection to the portfolio. The low-volatility funds include more stable stocks that have experienced the least price movement in their portfolio. Further, these are allocated primarily to defensive sectors that usually have a higher distribution yield than the broader markets.
More Gains Ahead?
Currently, USMV has a Zacks ETF Rank #3 (Hold) with a High risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.
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Low-Volatility ETF (USMV) Hits New 52-Week High
For investors seeking momentum, iShares Edge MSCI Min Vol USA ETF (USMV - Free Report) is probably on radar. The fund just hit a 52-week high, and is up 23.5% from its 52-week low price of $60.93 per share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
USMV in Focus
This product offers exposure to stocks having lower volatility characteristics than the broader U.S. equity market. It has key holdings in information technology, healthcare, communication and consumer staples. The ETF charges investors 15 basis points a year in fees (see: all the Large Cap ETF Blend here).
Why the Move?
The low-volatility corner of the broader market has been an area to watch lately, given inflation fears and resumption of global growth worries with the rise in delta variant. These products have the potential to outpace the broader market in bearish conditions or in an uncertain environment, providing significant protection to the portfolio. The low-volatility funds include more stable stocks that have experienced the least price movement in their portfolio. Further, these are allocated primarily to defensive sectors that usually have a higher distribution yield than the broader markets.
More Gains Ahead?
Currently, USMV has a Zacks ETF Rank #3 (Hold) with a High risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.