SPDR SSGA US Large Cap Low Volatility Index ETF

LGLV

Market cap $1.08B

LGLV offers a compelling low volatility approach with impressive sector diversification and a surprising growth/tech tilt, enhancing risk-adjusted returns. The ETF's methodology ensures broad sector representation, limiting concentration risk and providing exposure to defensive and growth-oriented stocks. While LGLV doesn't always outperform in every market downturn, it consistently delivers superior returns versus low volatility peers, especially in growth markets.

LGLV offers diversified, low-volatility large-cap exposure, with modest valuations and sector balance, making it attractive across different market conditions. Short-term risks include liquidity withdrawal, crowded long positioning, and fragile market sentiment, supporting LGLV's tactical appeal. Mid-term headwinds stem from slowing economic growth, uncertain Fed policy, and potential equity-bond rebalancing, favoring defensive strategies like LGLV.

LGLV offers a defensive, low-volatility approach, favoring financials and industrials, suitable for uncertain markets, with ongoing trade and monetary policy risks. Historically, LGLV has underperformed SPY in total returns, but it proved it can shine during periods of extreme market stress. Current macroeconomic conditions—Fed indecision, inflation risks, and trade tensions—make low-volatility exposure like LGLV attractive for cautious investors.

Volatility intensifies after Powell warns of rising inflation and slowing growth. The ETFs discussed here could be solid bets in the current choppy market.

The tech-focused Nasdaq officially entered bear market territory on April 4, 2025, falling over 20% from its December peak. The plunge came as Wall Street grew increasingly anxious about the economic health amid President Donald Trump's tariff announcement.

Volatility intensifies due to Trump's tariff plans and signs of economic slowdown. These ETFs could be solid investment options in the current choppy market.

SPDR SSGA US Large Cap Low Volatility Index ETF invests in 162 large-cap low volatility stocks with a low expense ratio of 0.12%. LGLV's unique weighting favors low-volatility stocks, resulting in a portfolio tilted towards mid-cap and large-cap value stocks with better growth potential. LGLV outperformed SPLV due to higher technology exposure and lower defensive sector allocation, but it can still face sector-specific risks.

Volatility in the stock market has intensified due to rising inflation fears, uncertainty surrounding rate cuts and ambiguity over Trump's tariff policies.

SPDR® SSGA US Large Cap Low Volatility Index ETF holds 163 low-volatility stocks, focusing on financials and industrials. The LGLV ETF has underperformed the Russel 1000 in return and Sharpe ratio since inception and shows a deeper drawdown, despite low volatility. LGLV features cheap fees and good performance relative to competitors.

LGLV offers lower volatility with a beta of 0.80-0.85, making it a suitable option for cautious investors amid economic uncertainty and potential market catalysts, such as the U.S. election. The ETF tracks the SSGA US Large Cap Low Volatility Index, focusing on large-cap U.S. stocks with low historical volatility. LGLV's sector allocation emphasizes Financial Services, Real Estate, and Industrials, while underweighting Technology, providing diversified exposure to mitigate concentration risk.