IJR’s largest sector weights are industrials, financial services and technology. In the small-cap space, those sectors generate significantly more of their revenue on a domestic basis than do their large-cap counterparts in the S&P 500.
“For some sectors like financials and industrials that are showing relatively large small cap premiums, the revenues generated from the U.S. are significantly higher for small caps. For example, financials have 17% more of revenues coming domestically, driving the small caps to outperform by 11% year-to-date through Jun. 29, 2018 that has been helped by rising interest rates, growth, inflation and the rising dollar,” said S&P.
For more information on small-capitalization stocks, visit our small-cap category.