New Russell ETFs Offer Targeted Volatility
As a practical application an investor who realizes they don't quite have the tolerance for the typical volatility that goes with an allocation to a standard index like the S&P 500 or Russell 1000 could create a more suitable allocation using the Russell funds.
For example a less tactical investor with a low tolerance for volatility could build a combo of 80% Russell 1000 Low Volatility and 20% Russell 1000 High Volatility which will allow for a somewhat smoother ride but also give some upside participation. This type of strategy could create a way back into equities for people who were scared out in 2008.
As a more tactical approach an investor could switch between lower beta and volatility funds and higher beta and volatility funds based on some sort of technical indicator such as the underlying index breaching a significant moving average.
In a slightly longer term perspective, if these funds are successful for investors then it would make sense for Russell to create similar funds built around foreign indices. Like the domestic funds, these would allow for specialized portfolio construction that, for now, cannot be had with broad index funds.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV