Is it Small-Caps' Time with Large-Caps Slowing? 50% Upside?

MillionaireTiger
03-28

The small and micro-cap Russell 2000 index rebounded sharply yesterday, gaining 2.13%, while the $S&P 500(.SPX)$ and $NASDAQ(.IXIC)$ rose by 0.86% and 0.51% respectively.

Historically, small-cap stocks have exhibited significantly higher volatility compared to the S&P and tech stocks, indicating a higher beta.

It's worth noting that shares of $iShares Russell 2000 ETF(IWM)$ closed at roughly 2-year highs.

It’s understandable people are skeptical about this type of move, especially given how badly small-cap stocks have underperformed over the last 18 months. While the mid/large/mega-cap indexes celebrate new all-time highs on a daily basis, the popular Russell 2000 ETF is still 15% off its highs.

With the slowing momentum in large-cap stocks, could it be time for small-cap stocks to shine?

Fundstrat’s Tom Lee continues to pound the table on his “50% upside” thesis for this segment of the market.

Our top idea for 2024 is small-caps, where we see at least 50% upside ..

Russell 2000 companies are set to grow .. faster than the $SPX ..

Valuations are far more attractive ..

When CEO confidence recovers, we also see the low valuations as setting the stage for synergistic M&A ..

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Let's take a look at the constituents leading the surge in $IWM:

IWM tracks a market-cap-weighted index of US small-cap stocks. The index selects stocks ranked 1,001-3,000 by market cap.

The top 10 holdings include this year's hot semiconductor dark horse, $SUPER MICRO COMPUTER INC(SMCI)$, and the company most correlated with BTC, $MicroStrategy(MSTR)$.

Additionally, notable companies like $Marathon Digital Holdings Inc(MARA)$, $CleanSpark, Inc.(CLSK)$, $SoundHound AI Inc(SOUN)$, $Viking Therapeutics(VKTX)$ and $Recursion Pharmaceuticals, Inc.(RXRX)$ are also included in this ETF.

With the deceleration in large-cap stock gains, is it time for small-cap stocks to make their move?

What do you think about the potential further gains for small-cap stocks?

# S&P 3-Day Decline: Hold Stocks or Cash for the Holiday?

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  • highhand
    ·03-28
    TOP
    yes it's time for small caps. as interest rates fall, they benefit the most. interest rate hikes had minimal impact to big caps. buy small caps now and wait for the surge. see you on the way up.
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  • Optionspuppy
    ·03-28
    @Blinkfans @MiniAce @LawrenceSG come come support my post new etf lets go
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  • MicroStrategist
    ·03-28
    I am waiting for the Green recovery man 👨 😪
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  • rendra fatwa gumilar
    ·03-29
    beieebbaaja
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