Equity ETFs with some downside protection?

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SnowSkier
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Equity ETFs with some downside protection?

Post by SnowSkier » Thu Sep 25, 2014 11:18 am

Which Equity ETFs would you expect to perform relatively well in corrections? (i.e. better downside protection, in comparison to other equity ETFs in similar asset classes)

These are some of the ones that come to mind as potential candidates, for further research. Thoughts?

For US Large Cap (suggested compares IVV, VOO/VFIAX)
+ VIG, Vanguard Dividend Appreciation, expense 0.10%, appears to target quality
+ SPLV, PowerShares S&P 500 Low Volatility, expense 0.25%, targets low volatility
+ SCHD, Schwab US Dividend Equity, expense 0.07%, appears to target quality & value
+ HDV, iShares Core High Dividend, expense 0.12%, appears to target quality & value

For Intl Developed Large Cap (suggested compare VEA/VTMGX)
+ EFAV, iShares MSCI EAFE Minimum Volatility, expense 0.20%, targets low volatility

For Emerging Mkts Large Cap (suggested compare VWO/VEMAX)
+ EEMV, iShares MSCI Emerging Mkts Minimum Volatility, expense 0.25%, targets low volatility

My list is heavily influenced by the writing of Samuel Lee at M*, so seeking additional info and other perspectives on answering this question.

Thanks

livesoft
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Re: Equity ETFs with some downside protection?

Post by livesoft » Thu Sep 25, 2014 12:13 pm

I don't see anything you listed as being helpful. Sorry.

How about one of those ETFs that shorts stocks? http://www.direxioninvestments.com/etfs ... 7AodFzcAtg I'm not recommending them at all.
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placeholder
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Re: Equity ETFs with some downside protection?

Post by placeholder » Thu Sep 25, 2014 12:17 pm

There's really no way to get the same upside potential with downside protection (or everybody would do that) so the only way to do it is to reduce the overall risk and you normally do that with fixed income.

dgdevil
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Re: Equity ETFs with some downside protection?

Post by dgdevil » Thu Sep 25, 2014 12:31 pm

Not sure if it really answers your question, but in this late phase of a bull market, energy, tech and industrials generally outperform - though I sold my energy ETF (XLE) yesterday given weak outlook for oil prices. Cash is king right now, though.

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tyler_cracker
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Re: Equity ETFs with some downside protection?

Post by tyler_cracker » Thu Sep 25, 2014 12:41 pm

imo this is like asking "what car should i buy for hauling lumber?"

the answer is that you shouldn't buy a car; you should buy a truck:

placeholder wrote:you normally do that with fixed income.

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