Survive the wild ride

If you believe the best way to outperform the sharemarket is picking risky shares, then think again. There is a strong challenge to this approach. It is known as low-volatility or minimum-volatility investing. The idea is to target shares with the lowest up and down movements.

Often these are the more “boring” or dependable stocks. Typically, private stockbrokers or fund managers don’t talk about them because they don’t have a captivating blue-sky story.

Low-volatility shares are found among the defensive sectors of the sharemarket: real estate, healthcare, consumer staples, utilities and telecommunications, says Bruce Apted, head of portfolio management at State Street Global Advisors’