Macroeconomic conditions for 2026 may seem a little bit shaky, but one area where advisors and investors might find great opportunities is actually within small-caps. Sure, this is likely not the first year that folks are hearing that small-caps might start threatening to outperform their large-cap counterparts.
Launched on May 22, 2000, the iShares Russell 2000 ETF (IWM) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Blend segment of the US equity market.
Small-cap stocks have trailed large caps for 15 years -- an historical anomaly. Eras of small-cap and large-cap outperformance generally last 6 to 16 years.
Small caps jump early in 2026, reviving the January Effect. ETFs like VTWO offer diversified exposure to potential seasonal and macro-driven gains.
The Proshares Russell 2000 High Income ETF targets higher yields via a covered call strategy on small-cap equities. I compare ITWO to the iShares Russell 2000 ETF, which tracks the Russell 2000 Index and offers modest yield and growth exposure. ITWO's distributions are tied to option premiums, but recent payouts have been inconsistent, complicating yield predictability.
XLK and other sector ETFs set to gain as expectations surge for a potential Federal Reserve rate cut in December.
Launched on May 22, 2000, the iShares Russell 2000 ETF (IWM) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Blend segment of the US equity market.
IWMI (Neos Russell 2000 High Income ETF) offers a 14.3% dividend yield by selling covered calls on the Russell 2000 index. IWMI underperforms IWM in strong markets but provides higher income. While theoretically the call premiums provide a drawdown parachute, in practice, due to the lower liquidity of IWMI, this has not proved to be effective.
Small caps rebounded lately. ETFs like IWM, FESM, VTWO & more outpaced SPY in 6 months as rate-cut hopes and easing tariffs fueled momentum.
After years of lagging behind their large-cap peers, small caps are finally poised for a meaningful move higher.
The earnings season is about to begin, and this period allows retail investors to get a peek into the businesses that are making money and the ones struggling.
After a long period of underperformance, small-cap U.S. stocks may be staging a comeback. While it's too early to say for sure whether this is the start of a sustained rally or just an occasional rise, recent data shows encouraging signs for small-cap investors.