Small-capitalization stocks and small-cap ETFs broke into new record heights Wednesday.
The iShares Russell 2000 ETF (NYSEArca: IWM), which tracks the benchmark Russell 2000 Index, rose 1.0% Wednesday while its underlying benchmark was 1.2% higher and hit a new intra-day record high.
“Small caps present a cleaner play than large caps on two fundamental market drivers: lower corporate taxes and a stronger US economy,” research firm DataTrek wrote in its morning briefing on Wednesday, Reuters reports.
Small-caps have been outperforming their larger peers, with IWM up 4.7% year-to-date while the S&P 500 gained 2.1%. The Russell 2000 Index has also gained 9% from its lowest 2018 close in early February while the S&P 500 rebounded 6%.