Small-Cap ETFs Set to Explode Under Trump Presidency

Zacks11-08

The Russell 2000 Index, which tracks US small-cap companies, rose about 6% to near-record highs and recorded the largest single-day gain in two years. The astounding surge came in the wake of Donald ...

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The astounding surge came in the wake of Donald ...</p>\n\n<a href=\"https://finance.yahoo.com/news/small-cap-etfs-set-explode-160000042.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Small-Cap ETFs Set to Explode Under Trump Presidency</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nSmall-Cap ETFs Set to Explode Under Trump Presidency\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-08 00:00 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/small-cap-etfs-set-explode-160000042.html><strong>Zacks</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The Russell 2000 Index, which tracks US small-cap companies, rose about 6% to near-record highs and recorded the largest single-day gain in two years. The astounding surge came in the wake of Donald ...</p>\n\n<a href=\"https://finance.yahoo.com/news/small-cap-etfs-set-explode-160000042.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"FT_SY_MNQ","symbol_name":"微型NQ100指数","start_time":0,"source_url":"https://finance.yahoo.com/news/small-cap-etfs-set-explode-160000042.html","article_id":"2481199847","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/kVC0Mai8CJ1xhqFnv1OZJQ--~B/aD00MDA7dz02MzU7YXBwaWQ9eXRhY2h5b24-/https://media.zenfs.com/en/zacks.com/146c1b17c3549165618fe8de61adf23a"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2481199847","pubTimestamp":1730995200,"columns":[],"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Trump recently proposed reducing the statutory corporate income tax rate from 21% to 15%. He also promised to extend tax cuts passed during his first term — set to expire at the end of next year. With reduced tax expenses, profits for smaller companies will grow.Trump’s administration is focused on deregulating many industries like energy and finance aiming to reduce the compliance costs, which businesses face. For small-cap companies, which often lack the financial resources of larger firms to manage regulatory compliance, reduced regulations mean lower operational costs. This shift will allow small-cap businesses to operate with increased profitability.Trump’s proposed tariffs against major U.S. trading partners would boost the greenback. A strong dollar provides an edge to domestic-focused companies as small caps do not have much exposure to the international market. As such, Trump's protectionist stance will benefit domestic producers, as higher import tariffs raise costs for forei","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4127":"投资银行业与经纪业","LU2360107671.USD":"BGF FINTECH \"A4\" (USD) INC","IWM":"罗素2000指数ETF","LU1201861249.SGD":"Natixis Harris Associates US Equity PA SGD-H","LU0345774391.USD":"NINETY ONE GSF AMERICAN FRANCHISE \"A\" (USD) ACC","SPSM":"SPDR Portfolio S&P 600 Small Cap ETF","SG9999014021.USD":"UNITED GLOBAL DURABLE EQUITIES (USDHDG) ACC","SCHA":"Schwab US Small-Cap ETF","RWM":"罗素2000指数反向ETF","LU1988902786.USD":"FULLERTON LUX FUNDS GLOBAL ABSOLUTE ALPHA \"I\" (USD) ACC","LU1791807156.HKD":"BGF WORLD FINANCIALS \"A2\" (HKDHDG) ACC","BK4585":"ETF&股票定投概念","BK4534":"瑞士信贷持仓","SG9999001077.SGD":"United International Growth Fund SGD","TWM":"罗素2000指数两倍做空ETF","IWN":"罗素2000价值股指数ETF-iShares","LU0266013472.USD":"AXA WF - Framlington Longevity Economy A Cap USD","LU0477156953.USD":"HARRIS ASSOCIATES US VALUE EQUITY \"RE\" (USD) ACC","LU0130517989.USD":"HARRIS ASSOCIATES US VALUE EQUITY \"R\" INC","SCHW":"嘉信理财","IWO":"罗素2000成长股指数ETF","LU1153585028.USD":"BGF GLOBAL LONG-HORIZON EQUITY  \"A4\" (USD) INC","FDN":"First Trust Dow Jones Internet I","SG9999014039.USD":"UNITED GLOBAL DURABLE EQUITIES (USDHDG) INC","SG9999014005.SGD":"United Global Durable Equities Fund Acc SGD","BK4535":"淡马锡持仓","LU0971096721.USD":"富达环球金融服务 A","SG9999014013.SGD":"United Global Durable Equities Fund Dis SGD","VB":"小型股指数ETF-Vanguard MSCI","LU0345774631.USD":"NINETY ONE GSF AMERICAN FRANCHISE \"A\" (USD) INC","IJR":"标普小型股600指数ETF-iShares","BK4550":"红杉资本持仓","BK4588":"碎股","LU2264538146.SGD":"Fullerton Lux Funds - Global Absolute Alpha A Acc SGD","LU1861217088.USD":"贝莱德金融科技A2","LU0106831901.USD":"贝莱德世界金融基金A2","LU1861220207.SGD":"Blackrock FinTech A2 SGD-H","LU0011850046.USD":"贝莱德全球长线股票 A2 USD","BK4589":"SVB概念","LU0130102774.USD":"Natixis Harris Associates US Equity RA USD","LU0648001328.SGD":"Natixis Harris Associates US Equity RA SGD","TZA":"罗素2000指数三倍做空ETF","BK4581":"高盛持仓","SRTY":"罗素2000指数三倍做空ETF-ProShares","BK4504":"桥水持仓","LU1064131342.USD":"Fullerton Lux Funds - Global Absolute Alpha A Acc USD","UWM":"罗素2000指数ETF两倍做多"},"translate_title":"特朗普总统任期内小盘ETF将爆发","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"VB":1,"SCHA":1,"IWM":1,"IJR":1,"SPSM":1,"FDN":0.9,"SCHW":0.9,"SRTY":0.6,"RWM":0.6,"UWM":0.6,"TZA":0.6,"TWM":0.6,"IWO":0.6,"MNQmain":0.6,"MRTYmain":0.6,"IWN":0.6},"content_text":"The Russell 2000 Index, which tracks US small-cap companies, rose about 6% to near-record highs and recorded the largest single-day gain in two years. The astounding surge came in the wake of Donald Trump’s victory in the presidential election.Analysts expect Trump's victory to lead to faster economic growth and more market-friendly policies. This is because Trump supports lower corporate tax rates, deregulation and other policies that favor domestic growth, all of which would provide more stimulus to the U.S. economy and benefit riskier assets. The anticipation of greater tariff barriers and a step to move manufacturing back home will drive small-cap stocks higher (read: ETFs Set to Soar on Trump's Presidential Victory).In order to tap this trend, investors should consider small-cap ETFs for diversified exposure across several sectors. We have highlighted five funds that have a Zacks ETF Rank #2 (Buy) each, suggesting their outperformance in the coming weeks. These are iShares Core S&P Small-Cap ETF IJR, iShares Russell 2000 ETF IWM, Vanguard Small-Cap ETF VB, Schwab U.S. Small-Cap ETF SCHA and SPDR Portfolio S&P 600 Small Cap ETF SPSM.\nCorporate Tax Cuts\nTrump recently proposed reducing the statutory corporate income tax rate from 21% to 15%. He also promised to extend tax cuts passed during his first term — set to expire at the end of next year. With reduced tax expenses, profits for smaller companies will grow.\nDeregulation\nTrump’s administration is focused on deregulating many industries like energy and finance aiming to reduce the compliance costs, which businesses face. For small-cap companies, which often lack the financial resources of larger firms to manage regulatory compliance, reduced regulations mean lower operational costs. This shift will allow small-cap businesses to operate with increased profitability.\nProtectionist Stance\nTrump’s proposed tariffs against major U.S. trading partners would boost the greenback. A strong dollar provides an edge to domestic-focused companies as small caps do not have much exposure to the international market. As such, Trump's protectionist stance will benefit domestic producers, as higher import tariffs raise costs for foreign competitors.\nMore Rate Cuts in the Cards\nAfter initiating a 50-bps rate cut in September, the Fed is expected to cut interest rates further this year. As the pint-sized companies have a higher debt burden (mostly at floating rates), lower rates lead to reduced borrowing costs, helping small businesses expand their operations easily and resulting in increased profitability. This, in turn, stimulates economic growth. As small-cap companies are more domestically tied, these are poised to outperform when the economy improves.\nGeopolitics\nSmall-cap stocks are considered safer and better plays if political issues or economic turmoil creep into the picture. Escalating tensions in the Middle East and the ongoing Russia-Ukraine war are driving the appeal for small-cap stocks.\nETFs Set to Explode\niShares Core S&P Small-Cap ETF (IJR) iShares Core S&P Small-Cap ETF offers exposure to U.S. small-cap stocks and follows the S&P SmallCap 600 Index. iShares Core S&P Small-Cap ETF holds 662 stocks in its basket, with none accounting for more than 0.8% of the assets. Financials, industrials, consumer discretionary and information technology are the top four sectors with double-digit exposure each. iShares Core S&P Small-Cap ETF is the largest and most popular ETF in the small-cap space, with AUM of $85.3 billion and an average daily volume of 3 million shares. The product charges investors 6 bps in annual fees.iShares Russell 2000 ETF (IWM)iShares Russell 2000 ETF is the largest and most popular ETF in the small-cap space, with an AUM of $68.9 billion and an average daily volume of 33 million shares. It tracks the Russell 2000 Index and holds well-diversified 1,973 stocks in its basket. IWM has key holdings in financials, healthcare, industrials and information technology.iShares Russell 2000 ETF charges 19 bps in annual fees (read: ETF Strategies to Consider as Trump Nears Victory).Vanguard Small-Cap ETF (VB) Vanguard Small-Cap ETF follows the CRSP US Small Cap Index and holds a basket of 1,384 stocks, with none holding more than 0.5% of the assets. Vanguard Small-Cap ETF is widely spread across various sectors, with industrials, consumer discretionary, financials, information technology and healthcare being the top five.Vanguard Small-Cap ETF has AUM of $60.5 billion and trades in a solid average daily volume of about 549,000 shares. VB charges 5 bps in fees per year from investors. Schwab U.S. Small-Cap ETF (SCHA) Schwab U.S. Small-Cap ETF tracks the Dow Jones U.S. Small-Cap Total Stock Market Index, holding 1,745 stocks in its basket. Each security accounts for less than 0.3% of the assets. Schwab U.S. Small-Cap ETF is widely spread across sectors, with financials, industrials, health care, information technology and consumer discretionary having double-digit exposure each. Schwab U.S. Small-Cap ETF has AUM of $18 billion and sees a solid volume of around 1 million shares a day. It has an expense ratio of 0.04%. SPDR Portfolio S&P 600 Small Cap ETF (SPSM)SPDR Portfolio S&P 600 Small Cap ETF follows the S&P Small Cap 600 Index, holding 605 stocks in its basket. None of the firms make up more than 0.7% of the assets. SPDR Portfolio S&P 600 Small Cap ETF is also widely spread out across sectors, with financials, industrials, consumer discretionary, information technology and healthcare having double-digit exposure each. SPDR Portfolio S&P 600 Small Cap ETF has been able to manage $11.9 billion in its asset base and trades in a good volume of 1.3 million shares a day on average. SPSM charges 3 bps in annual fees.\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\niShares Russell 2000 ETF (IWM): ETF Research Reports\niShares Core S&P Small-Cap ETF (IJR): ETF Research Reports\nSchwab U.S. Small-Cap ETF (SCHA): ETF Research Reports\nVanguard Small-Cap ETF (VB): ETF Research Reports\nSPDR Portfolio S&P 600 Small Cap ETF (SPSM): ETF Research Reports\nTo read this article on Zacks.com click here.\nZacks Investment Research","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2481199847"}