Invesco PowerShares launched a successful low-volatility exchange traded fund last year that focuses on U.S. stocks, and now the ETF provider is expanding the lineup with international offerings.
On Friday, PowerShares launched two new low-volatility ETFs, the PowerShares S&P Emerging Markets Low Volatility Portfolio (NYSEArca: EELV - News) and the PowerShares S&P International Developed Low Volatility Portfolio (NYSEArca: IDLV - News) .
“Given today’s market environment, investors are naturally seeking better ways to reduce volatility in their portfolios,” Ben Fulton, Invesco PowerShares managing director of global ETFs, said in a press release . “We believe the PowerShares family of low volatility ETFs may provide investors a degree of protection in down cycles while still participating in upward trending cycles, and have the potential to improve risk-adjusted returns over the long term.”
The PowerShares Emerging Markets Low Volatility Portfolio consists of the 200 least volatile stocks from the S&P Emerging BMI Plus LargeMid Cap Index over the past 12 months. The fund has an expense ratio of 0.25%.
EELV’s country allocations include Malaysia 24.1%, South Africa 18.1%, Taiwan 12.0%, unclassified 11.2%, Brazil 9.2%, Chile 6.0%, Morocco 4.7%, Mexico 4.6%, South Korea 2.5% and Thailand 2.4%. Sector allocations include consumer discretionary 6.8%, consumer staples 14.8%, energy 3.3%, financials 24.1%, health care 2.5%, industrials 8.7%, info tech 1.0%, materials 9%, N/A 4.0%, telecom services 10.6% and utilities 14.4%.
It should be noted that the fund holds both foreign securities and ETFs to achieve its target objective. For instance, the largest holding is an ETF – Global X FTSE Colombia 20 ETF (NYSEArca: GXG - News ), at 4.0% of the fund. The rest of the holdings are weighted at around 1% or lower.
The PowerShares International Developed Low Volatility Portfolio holds the 200 least volatile stocks of the S&P Developed ex. U.S. and South Korea LargeMid Cap BMI Index for the past 12 months. The fund has an expense ratio of 0.25%.
IDLV’s country allocations include Canada 20.4%, Japan 16.9%, U.K. 11.4%, Singapore 11.0%, New Zealand 9.0%, Australia 8.2%, Hong Kong 5.0%, Switzerland 3.2%, Netherlands 2.8% and France 2.4%. Sector allocations include consumer discretionary 11.3%, consumer staples 18.0%, energy 3.0%, financials 22.2%, health care 10.4%, industrials 13.9%, info tech 0.4%, materials 1.3%, telecom services 8.6% and utilities 11.1%. All of the fund’s holdings are mostly evenly distributed below 1%.
PowerShares S&P 500 Low Volatility Portfolio
For more information on market volatility, visit our volatility category .
Max Chen contributed to this article.