However, the stocks remain close to the all-time high. It's not the best time to take your money off the market.
Fortunately, there are several so-called exchange-traded funds with minimal or low volatility from respected money management companies like Fidelity, BlackRock, Invesco and others.
Value in proven blue chips
These and many other low and minimal volatility ETFs offer investors a mix of value stocks that share some of the features of safe bonds, said Troy Gayeski, co-chief investment officer at SkyBridge. You should benefit from a flight to safety.
Financial stocks are another group that can benefit from low volatility. According to KBW analyst Fred Cannon, banks outperformed the broader market in four out of the last five periods of low volatility.
According to Gayeski, investors could miss out on bigger profits by avoiding riskier parts of the stock market like tech in favor of clumsy and reliable dividend payers.
The US-China trade agreement to be signed this week could continue the general market recovery for some time to come. That means it may not be the right time to follow a cautious, risk-averse strategy.
"It is too early to be defensive. The first step in China may not be a moment when we hug each other in Kumbaya, but it prevents things from escalating further," said Gayeski.
Be prepared for the market to get bumpier at some point
Others argue that the market will not remain so optimistic indefinitely.
"Low volatility cannot last forever," KBW's Cannon wrote in a report last Friday.
To this end, it may make sense to include more consumer goods companies, healthcare stocks, real estate companies, utilities and financial services companies in your portfolio.
Dividend yields should become an increasingly important factor in market returns when it suddenly gets louder.
"I understand why people are concerned. We are late in this business cycle. People are choosing some good, old-fashioned dividend players," said John Norris, managing director of wealth and investment at Oakworth Capital Bank.
Norris told CNN Business that he was "amazed" at how quickly Iran had disappeared from the headlines of financial news. But he added that there were still question marks regarding earnings, the Federal Reserve's interest rate policy, and a possible economic slowdown.
"Volatility should be more normal this year," said Norris.
With this in mind, it may make sense for investors to prefer blue-chip stocks in more stable sectors, says Quincy Krosby, chief strategist at Prudential Financial.
Krosby believes there is still uncertainty about what will happen to the US and China even after a preliminary trade agreement is signed.
She added that CEOs and CFOs could hold back some important business decisions until the results of the presidential election become clearer. A more advanced democratic candidate could mean trouble for the healthcare, retail, and technology sectors.
"Is there a clear signal for the broader market? No. You have to do things quarterly," said Krosby. "So it will be important to focus on quality companies with strong cash flows and constant dividends."