— Wall Street's preferred index for large-cap stocks — is up slightly over that time period.
Valuations for small-cap stocks are at their most attractive levels since June 2003 relative to large caps, according to data compiled by Jefferies. Historically, small caps have outperformed large caps by an average of 6% over the following year when the valuation gap widens that much. The Fed has cut rates twice this year and is expected to lower them a third time at the end of October. Market expectations for an October rate cut are at 85%, according to the CME Group'sHistorically, small caps have outperformed large caps when the U.S. central bank is lowering rates. Small caps average a 12-month return of 27.9% after the Fed embarks on an easing cycle, Jefferies data shows. Large caps, meanwhile, average a gain of nearly 15% in that time.
Another reason to consider investing in small caps is the ongoing trade war between China and the U.S. The world's largest economies have slapped tariffs on billions of dollars worth of their goods over the past year, stoking fears around corporate earnings growth, especially for large-cap companies.
Small caps (and so-called penny stocks) get a bad rap because of scam artists and pump-and-dump schemes. But there are many small, well-run companies worth investing in on the Russell 2000, OTC and pink sheets. Like anything else, you must do your homework and make good choices.
d_kab1 only if they can borrow
yeah, well, maybe ...but this CHina thing can really screw their supply chains, no?
this has finally come full circle - FOX Biz now advertising on CNBC - the right-wing business news working together to spin & spread its lies & innuendoes. i don't know whether to laugh or cry, but i know the public doesn't have a clue, nor does Wall St whose only i is $'s