Low-volatility stocks continue to outperform the stock market while offering below-market risk, Barron's reports.

By investing directly in low-volatility stocks, you don’t need to know in advance which sector of the market will be less volatile, Barron's reported.

“The ingenuity of low volatility is that it automatically avoids stocks that are exposed to areas of increasing uncertainty,” Nardin Baker, chief strategist at South Street Investment Advisors in Needham, Mass.  “It is automatically adaptive.”

Barron's reported that Baker explained the low-volatility strategy is dynamic, dominated at different times by different sectors and investment styles.

"Currently, the list is dominated by energy stocks. More-diversified bets on the strategy are available with two ETFs: The S&P 500 Low Volatility ETF mentioned above, with an expense ratio of 0.25% (or $25 for every $10,000 invested) and the iShares Edge MSCI Minimum Volatility USA ETF (USMV), with an expense ratio of 0.15%," Barron's reported.

Barron’s suggested 10 lowest-volatility stocks:

1. • Aflac (AFL)
2. • Amdocs (DOX)
3. • American States Water (AWR)
4. • Atmos Energy (ATO)
5. • DTE Energy (DTE)
6. • Duke Energy (DUK)
7. • McDonald’s (MCD)
8. • NextEra Energy (NEE)
9. • OGE Energy (OGE)
10. • WEC Energy Group (WEC)

To be sure, other experts warn that a variety of risks are lurking to spark abnormal volatility in the market.

And while the benchmark S&P 500 index seemingly hits a record high on a daily basis amid as an almost giddy euphoria over the prospects of a U.S. interest rate cut fueled the appetite for equities, but there are plenty of pitfalls that could throw the stock market off course, Reuters explained.

From the high expectations for something positive on the U.S.-China trade front at next week’s Group of 20 summit, to rising geopolitical concerns and a worrying U.S. profit picture, the potential for missteps and stumbles is great.

Moreover, the rally appears to be based more on hope than reality, strategists said.

“This is probably one of the riskiest points you’re ever going to see in the stock market,” said Michael O’Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut. “The price level here is not supported by fundamentals. It’s supported by sentiment and hype and hopefulness about monetary policy.”

O’Rourke warned that some factors are a double-edged sword. While the market has embraced potential rate cuts, there is a downside to such cuts because they would be more likely if economic conditions deteriorate further, which is also a risk for stocks, he said. On the other hand, a trade deal with China may reduce the need for a Fed rate cut.

The recent gains in stocks follow a sharp selloff in May amid an escalation in the trade dispute between the world’s two biggest economies, which stoked fears of a global economic slowdown.

• Stock Investors Torn as Defensive Bets Go 'Parabolic'
• 'Crazy Rich' Credit Investors Ignore Record-High Risk Signs