Volatility Among Historically Divergent Sectors is Now Converging. A Comparison of Utilities and Insurers Illustrates What This Means for Portfolio Construction.
- Utility stocks are becoming more volatile and, from a valuation perspective, less attractive. Meanwhile, insurance stocks are currently expressing the risk and return attributes of a classically defensive exposure.
- At the same time, our proprietary macro-risk model adds important nuance to our risk and return assessments and, ultimately, to our defensiveportfolio positioning.