Low-volatility ETFs
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Bet on Low-Volatility ETFs Amid Iran War
ZACKS· 2026-03-12 13:01
Core Insights - U.S. stocks are experiencing pressure due to rising oil prices and geopolitical tensions, particularly involving the U.S., Israel, and Iran [1] - The International Energy Agency announced a record release of 400 million barrels of oil from strategic reserves, yet oil prices surged above $100 per barrel [4][3] Geopolitical Tensions - U.S. forces reportedly sank 16 Iranian vessels suspected of laying mines near the Strait of Hormuz, disrupting tanker traffic in the region [2] - Attacks on tankers in Iraq's port area have led to the closure of Iraqi ports, raising concerns about shipping risks across the Gulf [2][4] Market Reactions - Oil prices for West Texas Intermediate and Brent crude have climbed above $100 per barrel amid these tensions [3] - The Barclays iPath Series B S&P 500 VIX Short Term Futures ETN Series B (VXX) has increased by 6.3% over the past week and 12% over the past month, indicating heightened market volatility [5] Investment Strategies - Low-volatility ETFs are being highlighted as potential investment options during periods of market turmoil, focusing on defensive sectors such as utilities, healthcare, and consumer staples [6][11] - Specific low-volatility ETFs mentioned include: - iShares MSCI USA Min Vol Factor ETF (USMV) with a yield of 1.46% and fees of 15 bps [7] - Invesco S&P 500 Low Volatility ETF (SPLV) yielding 2.02% with fees of 25 bps [8] - iShares MSCI EAFE Min Vol Factor ETF (EFAV) yielding 3.03% with fees of 20 bps [9] - Franklin International Low Volatility High Dividend Index ETF (LVHI) with a yield of 4.64% and fees of 40 bps [12] - iShares MSCI Global Min Vol Factor ETF (ACWV) yielding 2.03% with fees of 20 bps [13]