During the periods of high volatility, low volatility index tends to show lower drawdown — the drop from the peak to the trough.

Synopsis

The Nifty Low Volatility 30 index — an index of large-cap companies with lower volatility relative to the benchmark index — earned 12.9% return over the past decade compared with 10.1% return of the Nifty 50.

ET Intelligence Group: A common perception among investors is that a portfolio composed of low volatility stocks results in sub-par performance compared with the benchmark indices. But, the historical trend in returns compiled from the NSE suggests otherwise. The Nifty Low Volatility 30 index — an index of large-cap companies with lower volatility relative to the benchmark index — earned 12.9% return over the past decade compared with 10.1%

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