As of December 12, the benchmark S&P/TSX 60 Index is up an impressive 21.1% year to date. This means that collectively, Canada's biggest and most notable companies have performed quite well – despite our economy being in the toilet.

If you're planning to start investing in 2025, this introduces a common concern: What if you're buying at the top? Over the long term, this isn't a major issue. Broad markets tend to rise over time, so even if valuations are high, lump-summing or dollar-cost averaging into the market can still work in your favour.

But let's say you're not entirely comfortable jumping in right now – and that's okay. Here are two exchange-traded funds (ETFs) that can help you sidestep volatility and navigate high valuations more cautiously.

Lower volatility stocks

If you want to sleep well at night but still stay invested in stocks, consider the BMO Low Volatility Canadian Equity ETF (TSX:ZLB).

Here's how it works: ZLB screens for stocks with a low beta – a measure of how much a stock moves relative to the market. While the market has a beta of 1, ZLB's stocks, on average, have much lower volatility. In fact, ZLB's five-year monthly beta is just 0.65.

Practically speaking, this means that when the market swings, ZLB's portfolio tends to move 35% less than the overall market, helping cushion the blow during downturns.

ZLB's composition also differs significantly from the S&P/TSX 60. The ETF avoids highly cyclical financial and energy stocks and instead focuses on defensive sectors like consumer staples and utilities – think grocery stores, electricity generation, and distribution.

Other holdings include companies from industries like waste management, dollar stores, and property and casualty insurance – all of which are less cyclical.

With a 0.39% management expense ratio (MER) and a respectable 2.3% dividend yield as of December 12, ZLB provides a solid mix of income and growth. Despite its lower-risk profile, it's no slouch in performance, delivering a 9.8% annualized total return over the last decade – outpacing the S&P/TSX 60.

Higher value stocks

If you're comfortable with volatility and want to take a contrarian approach, you might consider the BMO MSCI Canada Value Index ETF (TSX:ZVC) instead.

This ETF tracks an index containing 50 Canadian stocks screened for value based on metrics like price-to-book value, price-to-forward earnings, and enterprise value-to-cash flow from operations.

In simple terms, these metrics help identify companies that may be undervalued relative to their fundamentals, capturing stocks that are potentially trading below their intrinsic value.

For beginner investors, using ZVC allows you to systematically and objectively invest in a portfolio of 50 value stocks, which can potentially produce better results over time. While you might not find any "10-bagger" stocks in this ETF, you're also likely to avoid the significant losses that can come with riskier picks.

ZVC comes with a 0.40% MER and offers a decent 2.8% dividend yield. It's a solid option for those looking to add value exposure to their portfolio.