Top Stories
Top Stories

These 10 so-called safe stocks may be ready to drop

Chris Ratcliffe | Bloomberg | Getty Images

Buying stocks with low volatility crushed other investment strategies the last six years, according to analytics tool Kensho. But this run may be near an end, if statistics are any guide.

Some so-called safe stocks could be particularly vulnerable to losses when this low-volatility style goes out of favor, stats show.

Low-volatility performance versus other strategies

Source: Kensho

The chart above shows how low volatility is beating other investment styles such as earnings yield, momentum, value and low leverage this year and since 2010.

Using Kensho, we screened for the most overvalued low-volatility stocks vulnerable to a decline. We looked for the names whose forward price-earnings ratio is the farthest above their one-year average.