Low-volatility investing

[1][2] Two decades later, in 1992 the seminal study by Fama and French clearly showed that market beta (risk) and return were not related when controlling for firm size.

[3] Fisher Black argued that firms or investors could apply leverage by selling bonds and buying more low-beta equity to profit from the flat risk-return relation.

[5][6][7] In the same period, asset managers such as Acadian, Robeco and Unigestion started offering this new investment style to investors.

Low-volatility investing is gradually gaining acceptance due to consistent real-life performance over more than 15 years, encompassing both bull and bear markets.

Over shorter time periods, such as one year, Jensen's alpha is a useful performance metric, adjusting returns for market beta risk.