The strength in small-caps “means risk sentiment is improving as money grows more confident in less liquid names,” Gayed wrote.
The chart below shows the relative performance of IWM against SPDR S&P 500 ETF (NYSEArca: SPY). When the chart is rising, it means small-caps are outperforming large-caps.
Full disclosure: Tom Lydon’s clients own SPY and IWM.
