Small-cap stocks and small-cap ETFs are usually more volatile than their large-cap peers. That is the price investors pay for accessing the growth prospects offered by smaller companies, but the recent surge by some major small-cap ETFs has been accompanied by a noticeable decline in volatility.

Year-to-date, the iShares Russell 2000 ETF (NYSEArca: IWM), which tracks the benchmark Russell 2000 Index, is outperforming the large-cap S&P 500 by margin of better than 2-to-1 while being noticeably less volatile.

“In a small cap-led US equity market where the Russell 2000 Index has risen 9.6% relative to a 5.2% rise for the US large cap Russell 1000 Index as of June 11, the year-to-date volatility differential between small and large cap US stocks is at an all-time low,” according to new research from Cboe Global Markets (Cboe) and FTSE Russell.

Good News for Small-Caps

A stronger dollar means large companies with an international footprint are more susceptible to lower overseas demand for their products. Meanwhile, smaller companies are able to capitalize on a stronger domestic economy. Of the Russell 2000, S&P 500 and Nasdaq-100, only the small-cap benchmark has recently been notching fresh highs.

“A recent study by Cboe has found that the ‘small cap premium,’ or the difference between perceived US small cap volatility and US large cap volatility as reflected by average daily closing prices of the Cboe Russell 2000 Volatility Index (RVX) and the Cboe Volatility Index (VIX Index), is at the lowest point since it was first measured in 2004,” according to FTSE Russell.

Related: As ETF Adoption Grows, Go Beyond Costs

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