# BMO Low Volatility $US Equity ETF (ZLU-U)



## gardner (Feb 13, 2014)

I want to hold a significant chunk of $US and would split it into 3 parts:


general equity
low volatility
fixed income

I'm holding a block of VTI which will be my general equity.

I am considering BMO Low Volatility US Equity ETF (ZLU-U) as a 30% chunk as a low volatility component. The MER is 0.30%. I like the idea of what they're trying to do with this fund. But they're just getting started -- < $40M in it so far. Anyone done any research on this fund? Anything similar that I should be comparing it to out in the world?


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## Spudd (Oct 11, 2011)

The one I'm aware of is USMV.


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## gardner (Feb 13, 2014)

Spudd said:


> USMV


Thanks for that. Boy these are pretty low volume items. Even USMV with $2.4B in assets has a daily volume of 30K or so. ZLU.U doesn't appear to have traded at all in a month. These super-low volume guys make me wonder about liquidity and how effective price arbitrage really would be. The performance of USMV looks pretty-well identical to the DOW. It's tough to see where there is any less volatility there, IMO.


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## GoldStone (Mar 6, 2011)

SPLV is #1 by size in the US. USMV is #2. iShares XMU is a Canadian wrapper for USMV. 

Do a lot of reading before you take the plunge. Low volatility strategy is quite controversial.


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## GoldStone (Mar 6, 2011)

30K daily volume is wrong. Morningstar quotes 950K.

http://etfs.morningstar.com/quote?t=USMV


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## gardner (Feb 13, 2014)

GoldStone said:


> 30K daily volume is wrong


Perhaps today is a slow day, but Google finance says 33,338 for the day, most of that in what looks like two trades of 12,000.


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## GoldStone (Mar 6, 2011)

Google Finance daily data is not reliable. Yahoo.com says 195K today and 539K three-month average.

In any case, daily volume should be the least of your concerns about this strategy. There are many other, more important things to consider.


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