Minimum Volatility Definition

Learn the definition of minimum volatility and other ETF terminology from the etf.com glossary.

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Reviewed by: etf.com Staff
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Edited by: etf.com Staff

Learn more about Minimum Volatility

Also known as low volatility ETFs, Minimum Volatility ETFs represent a strategic approach within the ETF landscape, focusing on constructing portfolios with reduced price volatility compared to the broader market. These ETFs deploy various strategies, such as optimizing stock selection or incorporating low-volatility factors, to achieve the objective of minimizing overall portfolio volatility. Investors gravitate towards Minimum Volatility ETFs for their potential to offer a more stable investment experience, particularly during market downturns. By prioritizing lower-risk assets, these ETFs aim to provide investors with a smoother ride through market fluctuations, aligning with risk-averse investment preferences.

Related Terms

ETF Glossary is etf.com’s collection of key terms and definitions related to exchange-traded funds. ETFs are investment funds that are traded on stock exchanges, and they can encompass a wide range of asset classes, including stocks, bonds, commodities and more. Given the diverse range of ETFs and the complexity of financial markets, having a clear understanding of ETF-related terminology is instrumental for investors looking to make informed decisions, manage risks effectively and navigate the evolving landscape of ETF investments.