Tag Archives: small cap premium

Bearish Divergence May Signal Stock Market Warning

Despite escalating trading tensions between U.S. and China that built through Sep., large caps were largely unaffected.  The aging Bull market (since March 9, 2009) showed no signs of stopping, as the S&P 500 posted new highs and posted an annualized 16.51% equity return and 18.91% with dividends, as mentioned by Howard Silverblatt in Market Read more […]

The S&P 600 Escapes Suffocation From Q4 Benchmark Hugging

Small caps are outperforming large caps significantly in 2018, mainly from the tax cuts, growth,  strong dollar and concern about international trade.  This has driven the S&P 600 (TR) 8.4% higher than the S&P 500 (TR) (year-to-date through Aug.31, 2018,) measuring the 5th biggest small cap premium in history since 1995, and is the biggest Read more […]

In Small Caps, Financials Rise Most From GDP Growth

On Friday morning the GDP (Gross Domestic Product) for Q2 2018 is set to be announced, and the consensus estimate from the Wall Street Journal survey of more than 60 economists is at 4.1%, the highest (actual) growth since Q3 2014.  Although forecasts greatly vary this quarter, the main factors likely influencing growth are tax policy, retail Read more […]

One Big Problem In July For One Small Cap Index

Much attention has been drawn to small caps by top tier media since the small cap premium is now the biggest in eight years and the fifth biggest in history. The outperformance of the small cap stocks versus the large caps is being driven by the current economic environment of growth, rising interest rates, inflation and Read more […]

Small Cap Premium Is 5th Biggest In History

Small caps are outperforming large caps (S&P 600 (TR) – S&P 500 (TR)) in H1 2018 by the most in eight years, since H1 2010, from growing  concerns over rising tariffs and general U.S. foreign trade policy. In the past four months, the smaller companies have outperformed larger companies by 10.1%, contributing to the 5th biggest Read more […]

What’s In A Sector?

Following an index announcement stating Nektar (NKTR) among other stocks would be moving to the S&P 500 prior to the open on March 19, 2018, an inquiry came in about the index impact of NKTR on the S&P SmallCap 600 Health Care Index performance.   Given the stock rose over 70% in 2018, it seemed reasonable to Read more […]

Why Your Interest In Weights Should Rise With Rates

Historically as interest rates have risen, equities have done well.  As illustrated in this post, since 1971, the S&P 500 (TR) has gained about 20% on average in rising rate periods, has gained 8 of 9 times and has gained nearly 40% twice with less than a 4% loss for its worst rising rate period.  Also shown Read more […]

There’s Nothing Equal About Equal Weight Returns

Let’s use the S&P 500 as a starting point since it is the most basic beta, or representation of the U.S. stock market.  Since its launch in 1957, it has grown with the stock market and has become the most widely used benchmark of the U.S. stock market with numerous products tracking it.  Although in Read more […]