Also Monday, Boingo Wireless (NasdaqGM: WIFI) added 24% following reports Deutsche Bank started coverage of the stock with a buy rating.
The small-cap ETF’s performance in 2011 is on par with the S&P 500, but the microcap fund is in negative territory to lag blue-chip stocks.
Because of their high volatility, “only the steeliest investors should overweight this segment of the market” while the historical return premium of microcaps reliably shows up only over decades, Morningstar analyst Samuel Lee writes in his take on the ETF.
“Microcap stocks are highly volatile because their issuing companies are less diversified, less well-run, and often highly speculative ventures; they go bankrupt far more often than big companies and are highly sensitive to economic conditions,” he said. “Over several years-long stretches, they’ve lost a lot of money and stayed down.”
iShares Russell Microcap
