Large-cap names with solid growth and deep cash reserves can absorb higher rates far better than small caps. That's a big reason we're seeing weakness in Russell 2000 ($iShares Russell 2000 ETF(IWM)$ ) even while $SPDR S&P 500 ETF Trust(SPY)$ and $Invesco QQQ(QQQ)$ have recently been making new highs.
The flip side is that if the war actually ends, oil drops, inflation fades, and rate-hike pressure goes away or even shifts toward cuts, small caps could see a much stronger rally.
At the first sign of a peace deal, I'll load up on $Direxion Daily Small Cap Bull 3x Shares(TNA)$ or URTY.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
