Revealed: The least volatile US stocks of the past decade

09 Feb 2012 | 07:44
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Coping with market volatility has become a pressing need for US equity managers since the start of the financial crisis, but which companies have proved themselves capable of riding out the storm?

Most managers argue that investment time horizons make most daily market moves nothing more than short-term noise. But even on a decade long view, there are just seven stocks in the S&P 500 that have a high/low spread of less than 100% of their market value.

The research from Bespoke Investment Group encompasses the period from February 2002 to February 2012, incorporating much of the so-called ‘lost decade' for stocks. But for investors looking for dependability, the go-nowhere nature of these shares may seem more like a virtue, particularly when dividends are taken into account.

Among the least volatile stocks are a number of names known for their reliable income streams: Investors in Coca-Cola and Johnson & Johnson, for example, have enjoyed 49 consecutive years of dividend increases from either company.

Such consumer staples have been a feature of developed market portfolios of late, finding favour with managers looking for dependable defensives as the West struggles to reinvigorate growth rates.

The study suggests they may be on to something: 11 of the 17 least volatile stocks reside in the consumer staples sector, including familiar names such as Heinz, Kraft and Colgate-Palmolive. The only financials firm in the top 40, by contrast, is Warren Buffett's Berkshire Hathaway.

 Least volatile S&P 500 stocks, February 2002 - February 2012

 Stock Sector 10-year high/low spread %

 Wal-Mart

 Consumer Staples 54.07
 Kimberly-Clark  Consumer Staples 75.51
 Progress Energy  Utilities 79.68
 Johnson & Johnson  Healthcare 80.77
 SCANA  Utilities 93.57
 Coca-Cola  Consumer Staples 93.92
 Consolidated Edison  Utilities 99.56
 HJ Heinz  Consumer Staples 106.24
 Kraft Foods  Consumer Staples 111.2
 Waste Management  Industrials 112.81
 Sysco  Consumer Staples 112.84
 Campbell Soup  Consumer Staples 117.05
 General Mills  Consumer Staples 119.00
 Abbott Laboratories Healthcare 119.17
 Colgate-Palmolive  Consumer Staples 121.24
 ConAgra Foods  Consumer Staples 123.67
 PepsiCo  Consumer Staples 127.91
 Automatic Data Processing  Technology 133.34
 UPS  Industrials 134.56
 DTE Energy  Utilities 137.05
 Pinnacle West Capital  Utilities 138.11
 Verizon  Telecom 138.68
 3M  Industrials 140.25
 Kellogg  Consumer Staples 141.28
 Walgreen  Consumer Staples 142.48
 Illinois Took Works  Industrials 144.15
 Hershey  Consumer Staples 144.43
 Paychex  Technology 151.11
 Clorox  Consumer Staples 151.89
 Northrop Grumman  Industrials 152.03
 Microsoft  Technology 152.19
 Medtronic Healthcare 152.75
 Bemis  Materials 154.67
 AGL Resources  Utilities 158.96
 Genuine Parts  Consumer Discretionary 160.18
 Berkshire Hathaway  Financials 162.81
 Procter & Gamble  Consumer Staples 170.78
 Federated Investors  Financials 174.72
 Comcast  Consumer Discretionary 175.15
 Cardinal Health  Healthcare 178.63

 

Categories: Equities

Topics: S&p 500Equities

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