March 23, 2006 at 1:35 pm by Tom Lydon
Predictions can get you into trouble.
Today was another day where small-cap stocks advanced and large-cap stocks were down. For the past 12-18 months Wall St. has been telling investors the shift in momentum is moving from small-cap stocks to large-cap stocks. Nope. Not even close.
Last year small-caps gained 8% and mid-cap stocks were up 12% compared to a 3% gain for the S&P 500. (The Dow was down .6%) Year-to-date small-caps are up close to 11% while the S&P 500 is up a little over 4%.
One day the tide will turn, but in the mean time hold on to your small-cap stocks, funds and ETFs. These trends may continue for another year or two as small companies nimbly react to the recovering economy.
The most widely held small-cap ETFs include S&P 600 Small-Cap Index equivalents and Russell 2000 equivalents: iShares S&P Small Cap 600 Growth (IJT), iShares S&P Small Cap 600 Indes (IJR), iShares S&P Small Cap 600 Value (IJS), iShares Russell 2000 Index (IWM), iShares Russell 2000 Growth (IWO) and iShares Russell 2000 Value (IWN).
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