Investing can be a rollercoaster ride, with the ups and downs of the market affecting our portfolios. Volatility plays a crucial role in this arena, reflecting the risk associated with different stocks. Standard deviation, a key metric in the investment world, measures how far a security’s price deviates from its average over a specific period.
Understanding standard deviation is essential for investors, as it provides insights into the volatility and risk of an investment. The greater the standard deviation, the higher the risk involved. In simple terms, standard deviation quantifies the extent of a security’s price fluctuations from its mean value.
To help investors navigate the complexities of the stock market, we have compiled a list of low volatility stocks. These stocks are the 100 lowest standard deviation stocks in the S&P 500 Index. By focusing on low volatility stocks, investors can potentially mitigate risk and build a more stable investment portfolio.
Let’s delve deeper into the concept of standard deviation and explore five dividend-paying stocks with the lowest standard deviation in the Sure Analysis Research Database.
Standard Deviation Overview
Standard deviation is a statistical measure that calculates the dispersion of a security’s prices from its mean value over a specified period. It provides a way to gauge the volatility of a stock and assess the associated risk. In a normal distribution, a stock’s price should typically fall within one standard deviation of its mean about 68% of the time.
However, there is still a probability of the stock price deviating beyond this range, emphasizing the importance of understanding standard deviation as a risk metric. Low volatility stocks are expected to perform steadily during market fluctuations, making them attractive to risk-averse investors.
Low Volatility Stock #5: Verizon Communications (VZ)
Verizon Communications, a prominent wireless carrier, boasts a resilient business model with a strong market presence. Despite a slight revenue decline in the recent quarter, the company displayed robust performance in key metrics such as postpaid phone net additions and wireless revenue growth.
Low Volatility Stock #4: Procter & Gamble (PG)
Procter & Gamble, a global consumer products giant, reported solid financial results in the first quarter of fiscal 2025, surpassing analysts’ expectations. With a focus on organic sales growth and core earnings-per-share expansion, P&G continues to deliver value to shareholders.
Low Volatility Stock #3: The Coca-Cola Company (KO)
Coca-Cola, a beverage behemoth, exceeded revenue and profit estimates in its recent earnings report. The company’s strategic initiatives to innovate and expand its product portfolio have contributed to its impressive performance.
Low Volatility Stock #2: Colgate-Palmolive (CL)
Colgate-Palmolive, renowned for its diverse portfolio of consumer brands, demonstrated solid growth in its recent earnings. With a strong foothold in both oral care and personal care segments, the company continues to drive shareholder value.
Low Volatility Stock #1: Johnson & Johnson (JNJ)
Johnson & Johnson, a healthcare titan, reported strong sales growth in the third quarter of 2024. Despite a decline in earnings per share due to one-time charges, the company’s operational performance remained robust, underscored by its innovative product pipeline.
In conclusion, standard deviation serves as a valuable tool for investors to assess risk and make informed investment decisions. By focusing on low volatility stocks, investors can potentially enhance portfolio stability and achieve favorable returns. Consider exploring these dividend-paying stocks with low standard deviation to build a resilient investment portfolio. Stay informed, stay diversified, and navigate the market with confidence.
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