Have you ever wondered how billionaires continue to get RICHER, while the rest of the world is struggling?

I study billionaires for a living. To be more specific, I study how these investors generate such huge and consistent profits in the stock markets — year-in and year-out.

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Thus, given the current volatile market scenario and that the Fed has began winding up its massive stimulus program, it might be prudent for investors to reallocate their portfolios to low risk products.

Low Risk ETFs

Low risk investments can prove to be quite effective in one’s portfolio in arresting downside risks as compared to high beta products.  It is one of the most popular investing themes these days, given the significant jump in volatility since the start of the year.

These products have a low correlation with other assets classes, and as such, go a long way to reduce the overall portfolio risk.

Below, we have mentioned three low risk ETFs which can be good choices to add to one’s portfolio, if the current turmoil in the markets continues.

U.S.  Market Neutral Anti-Beta Fund  (BTAL)

Using a long-short strategy might be a perfect way for investors to hedge their portfolio amid the volatility in the market. As such, BTAL is a good choice to do so (see all the Long-Short ETFs here ).

The fund tracks the performance of the Dow Jones U.S. Thematic Market Neutral Anti-Beta Index before fees and expenses. BTAL charges 99 basis points as fees, slightly expensive than other broad based ETFs.

BTAL takes a long position on low beta stocks, while at the same time taking a short position on high beta securities of approximately equal dollar amounts, within each sector. The index seeks to deliver the spread return between low beta and high beta stocks (stocks that are more volatile than the index).

The fund is equal weighted, dollar neutral, sector neutral and doesn’t uses leverage. The fund holds a long position in 200 stocks, having an average beta of 0.87, and a short position in another basket of 200 stocks with an average beta of 1.43.

Investors are expected to profit from this fund when the basket of long stocks outperforms the short portfolio.

Also, investors should keep in mind that due to the fund’s unique style of investing, the fund will underperform in bull markets and outperform in bear markets.

As such, the fund lost 11% in 2013. Though that’s the case for last year, things might turn around this year, if the current sluggishness in the markets continues.