Once a year, there’s a moment in the US stock market when smaller companies get heard. This year it came at the end of June with the annual changes to the Russell 2000 index of small-cap stocks. The “Russell reconstitution” of its various indices generates about a 50 per cent jump in overall daily trading volumes for the US market as the $10.5tn of funds that track FTSE Russell’s US index family adjust their holdings.
Its constituents, following the June adjustments, range from $10.7bn FTAI Aviation, a jet engine maintainer that has outperformed Nvidia over the past year, to 77-year-old Richardson Electronics, a speciality equipment distributor worth $160mn Compare the moves in the Russell 2000 and the S&P 500 over six months and small caps have only underperformed their bigger cousins this badly at two other points since the 2000 dotcom boom — and even then, barely.