What has long been a murmur has recently turned into a volley of cat calls. As yields turn tail on expectations of rising inflation and a lurch to tighter policy, so the peachy multiples of fashionable revved up growth stocks have come into the crosshairs. Specifically those that are, perhaps, little fast on the pitch, those that generate little to no profit and flirt with the hot breath of the two-a-penny celebrity endorsed SPAC. With Biden’s $1.9tr plan easing its way down the legislative hose, the pressure on yields is likely to continue to be on the upside. More so when recent comments from the quarterly dance of results calls are considered. Chef’s Warehouse, a businesses that distributes food to high end restaurants talked up expectations of a “massive explosion” of catering as people, especially those planning weddings, go large after a year of homemade lasagne. Hilton Hotels used the phrase “gargantuan” when talking about the demand outlook. No wonder, more broadly, CEO expectations have reached the highest level in nearly forty years. One little discussed alpha opportunity to play into a recovering economy might be, though, defensive stocks, or stocks tarred by factor investors as low volatility. Brokers have recently been pointing to this cohort as a place to place some chips given they are trading at extremely depressed levels relative to the broader market. This may seem a bit counterintuitive into a pro-cyclical regime, but for active management to outperform a market saturated with stocks that have gorged themselves on the ZIRP buffet, a different game is required. Should eye-popping absolute valuations start to hiss air due to rising rates, and the winning styles of recent years cop it in a more meaningful manner; cheap, low volatility stocks could well outperform. And given the performance divergence depicted in the brokers’ charts, they could outperform by some distance.