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