What’s Driving The Rotation Into Small-Cap Stocks? - J.P. Morgan

Jul 19, 2024 · When positioning is that stretched, it only takes a small spark to ignite a powerful rotation. It wasn’t just short covering. For the week ending July 12, equity exchange-traded …

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3 Reasons Investors Should Rotate Into Smaller Stocks, Citi Says ...

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Nov 1, 2024 · They say small and mid-cap stocks are pricing in 2%-10% growth in earnings-per-share over the next three years, while the S&P 500 is expected to show 15%-22% EPS growth.

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Fund Managers Were Caught Off Guard By Small-Cap Stocks …

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Aug 5, 2024 · Even managers of small-cap funds, which benefited from the rotation, weren't prepared to capitalize on the shift. Only 14% of small-cap funds beat the Russell 2000’s ( RUT …

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FAQs about What’s Driving The Rotation Into Small-Cap Stocks? - J.P. Morgan Coupon?

Will small caps benefit from a rotation in tech & growth stocks?

At the same time, tech and growth stocks have wobbled, reinforcing the view that small caps have benefited from a rotation out of this year’s biggest winners into unloved areas of the market. The tech-heavy Nasdaq 100 (.NDX) is down 3% since last week, including its biggest one-day drop of the year on Wednesday. ...

Will a rotation into small caps work?

“Our view on the rotation into small caps is that it can only work if you get soft landing data and Friday’s payrolls were definitively not that,” said Stuart Kaiser, head of US equity trading strategy at Citigroup. “It’s a strong headwind for that rotation into smaller cap-value, lower quality-type stocks.” ...

Are small caps vs large cap Tech a 'great rotation'?

Small caps (orange line) vs large cap tech (blue line) in just the last month. (Source: TradingView) It's led to the financial press coining this move as the "Great Rotation". But as experienced investors can tell you, one month does not make a trend and paradigm shifts should not be confused for garden variety corrections. ...

What is a 'rotation' in the stock market?

On trading desks, this changing leadership in the stock market is called a “rotation.” It began in earnest this month after new inflation data, which confirmed that price increases continued to slow in June, crystallized the view that the Fed will begin to cut interest rates in September. ...

Will domestic equity ETFs rotate into small-cap value during market downturns?

Market signals indicated a possible top, leading to selling of domestic equity ETF exposure despite rotation into Mid & Small Caps. Historical analysis of Russell 2000 Value vs. Growth signals potential for rotation into Small-Cap Value during market downturns. ...

Are We entering a secular rotation into US small-cap stocks?

"A recent surge in the Russell 2000 after the US CPI report for June was published last week has prompted claims that we are entering the initial stage of a secular rotation into US small-cap stocks. We are not convinced," Higgins said. First, Higgins said the recent market action shouldn't be thought of as a rotation. ...