Performance within the investment landscape - which has been dominated by large-cap funds for quite some time - appears to be experiencing a shift.
To date, large-cap indexes exhibiting strong exposure to the tech sector have delivered superior performance in 2023, whereas small-cap indexes with high exposure to the banking sector, especially in the U.S. with the small regional banks, have underperformed following the collapse of SVB.
Yet, small-cap stocks have now outperformed their larger counterparts for the second week in a row, with data showing the Russell 2000 gained +1.51% week-over-week (11.30% year-to-date), while the S&P 500 was up 0.69% (+18.15% year-to-date).
A review of aggregated metrics conveyed similar findings. The small-cap market segment, composed of 146 funds, achieved a performance of +2.20% over the past week while also generating robust capital flows totaling around $581 million, with nearly $10 billion since the start of the year. It’s fair to say that small-cap stocks are successfully compensating for their early-year performance lag.
Drilling down further into specific fund-level data reinforces this trend. Both iShares Core S&P Small-Cap ETF (NYSE:IJR) and Vanguard Small-Cap Value Index Fund ETF Shares (NYSE:VBR) reported strong performance of +2.53% and +2.72% for the week respectively, alongside capital inflows of $217 million and $86 million.
Group Data: Small Cap Segment
Funds Specific Data
This content was originally published by our partners at ETF Central.