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. Momentum Vol. Risk Contrib. MDD
 
AMETEK AME NYSE Industrial Goods Precision, Measurement & Processing USD 135.84 31 B 63.9% Weak Up 25%   7% -11%
Amphenol APH NYSE Industrial Goods Cables, Connectors & Cabling Networks USD 66.95 40 B 55.1% Neutral 27%   7% -12%
Coca-Cola Company KO NYSE Consumer Non-Durables Beverages - Diversified USD 54.54 235 B 26.0% Weak Up 22%   5% -12%
Ecolab ECL NYSE Industrial Goods Pollution Control Equipment USD 228.50 65 B 18.7% Weak Up 29%   7% -20%
Fidelity National Information Services FIS NYSE Finance Financial Data Processing USD 151.80 94 B 18.4% Strong Up 27%   6% -21%
Fortive FTV NYSE Industrial Goods Precision, Measurement & Processing USD 72.45 24 B 25.4% Neutral 33%   7% -25%
Honeywell International HON NYSE Conglomerates Industrial Conglomerates USD 228.66 159 B 74.3% Neutral 29%   8% -15%
Johnson & Johnson JNJ NYSE Health Care Diversified Healthcare USD 167.74 441 B 16.4% Neutral 17%   3% -11%
Lockheed Martin LMT NYSE Industrial Goods Aerospace/Defense - Major Diversified USD 387.34 108 B 4.8% Neutral 24%   5% -21%
Marsh & McLennan Companies MMC NYSE Finance Specialty Insurers & Brokers USD 137.77 70 B 36.9% Weak Up 20%   4% -13%
McDonald's Corp. MCD NYSE Services Hotels, Restaurants, Fast-Food & Resorts USD 234.86 175 B 31.8% Weak Up 19%   4% -10%
Moody's Corp. MCO NYSE Finance Financial Database Services USD 329.60 62 B 33.7% Strong Up 25%   4% -14%
NextEra Energy NEE NYSE Utilities Renewable Energy Generation USD 74.01 145 B 33.7% Neutral 26%   4% -18%
Northrop Grumman NOC NYSE Industrial Goods Aerospace/Defense - Engineered Systems USD 370.05 62 B 15.5% Strong Up 25%   5% -18%
Raytheon Technologies RTX NYSE Industrial Goods Aerospace/Defense - Engineered Systems USD 84.68 129 B 51.0% Strong Up 38%   9% -29%
Roper Technologies ROP NYSE Industrial Goods Engineered Products & Materials USD 446.20 47 B 25.7% Weak Up 25%   5% -19%
Visa V NYSE Finance Electronic Payments Services USD 231.32 452 B 27.1% Weak Up 25%   6% -16%
Waste Management WM NYSE Utilities Environmental Services & Waste Mngt USD 141.48 60 B 41.6% Strong Up 21%   5% -10%