US Large Cap Selection for Peace of Mind

US Large Cap Selection  for Peace of Mind
  • Pininvest Analysis

With the launch of a number of low volatility funds, the fact higher risk may not after all – and over time – be rewarded with higher performance, as the theory suggests, has been given publicity

However, a few sectors will be overweight in low volatility asset selections, with Utilities and Finance counting for 50¨% of a 100 low volatility / large market cap asset selection

The sensitivity of these dominant sectors to the business cycle will determine the actual outcome over time, as the business cycle runs its course – and not over just one year

Under the assumption an investor might seek stability without having to align his or her expectations with the full cycle, we create – as a reference dated mid-January 2018 – a portfolio based on the lowest volatilities and the lowest Maximum Drawdown (smallest continuous price drop observed over the past year), resulting in a fairly balanced sector combination in the large cap universe

If this selection provides peace of mind (by outperforming the benchmark SPDR® S&P® 500 ETF) remains to be seen

Read our note

US Large Cap Selection for Peace of Mind • Updated:

Name Ticker Exchange Sector Industry Currency Cur.Price Mkt.Cap Perf. Vol. Risk Contrib. MDD
 
AMETEK AME NYSE Industrial Goods Precision, Measurement & Processing USD 99.33 23 B 39.2% 18%   7% -10%
Amphenol APH NYSE Industrial Goods Cables, Connectors & Cabling Networks USD 103.41 31 B 21.3% 20%   6% -20%
Coca-Cola Company KO NYSE Consumer Non-Durables Beverages - Diversified USD 57.01 244 B 23.6% 17%   4% -10%
Ecolab ECL NYSE Industrial Goods Pollution Control Equipment USD 198.18 57 B 29.0% 16%   5% -13%
Fidelity National Information Services FIS NYSE Services Design Engng, Supply Chain & IT Services USD 147.96 91 B 44.2% 19%   7% -10%
Fortive FTV NYSE Industrial Goods Precision, Measurement & Processing USD 75.03 25 B 2.2% 21%   5% -28%
Honeywell International HON NYSE Conglomerates Industrial Conglomerates USD 175.46 125 B 26.2% 17%   6% -12%
Johnson & Johnson JNJ NYSE Health Care Drug Manufacturers - Diversified USD 149.50 393 B 17.6% 16%   2% -12%
Lockheed Martin LMT NYSE Industrial Goods Aerospace/Defense - Major Diversified USD 437.17 123 B 52.8% 16%   6% -7%
Marsh & McLennan Companies MMC NYSE Finance Specialty Insurers & Brokers USD 115.14 58 B 42.0% 16%   6% -8%
McDonald's Corp. MCD NYSE Services Hotels, Restaurants, Fast-Food & Resorts USD 210.39 158 B 18.1% 15%   3% -15%
Moody's Corp. MCO NYSE Finance Financial Database Services USD 260.19 49 B 69.0% 20%   9% -11%
NextEra Energy NEE NYSE Utilities Renewable Energy Generation USD 265.81 130 B 56.7% 14%   2% -7%
Northrop Grumman NOC NYSE Industrial Goods Aerospace/Defense - Engineered Systems USD 381.84 64 B 38.2% 22%   7% -12%
Raytheon Company RTN NYSE Industrial Goods Aerospace/Defense - Engineered Systems USD 227.62 63 B 35.1% 21%   5% -9%
Roper Industries ROP NYSE Industrial Goods Engines, Industrial Equipt & Cpts USD 377.90 39 B 34.1% 18%   7% -14%
Torchmark Corp. TMK NYSE Finance Life Insurance USD 88.10 10 B 7.4% 12%   2% -9%
Visa Inc. V NYSE Finance Financial Transaction Services USD 202.85 399 B 51.0% 17%   7% -9%
Waste Management WM NYSE Utilities Environmental Services & Waste Mngt USD 121.05 51 B 29.9% 14%   4% -10%