FYI: (Original article, Bloomberg 10/3/17)
While the markets have been rocking across the globe in 2017 without a hint of volatility, the current bull market hasn’t always been easy. The S&P 500 hasn’t hit the standard definition of a bear market (a drawdown of 20% or more) in many years but a number of other markets did in late-2015/early-2016. Small cap stocks in the U.S. were down almost 30% in that time. This is nothing new as small cap stocks tend to perform differently than their large cap brethren. As investors look to diversify beyond the S&P 500, it makes sense to understand how other markets generally behave. The following piece I wrote for Bloomberg gives a historical look at small caps and their cyclical nature.
Regards,
Ted
http://awealthofcommonsense.com/2017/12/when-small-caps-finally-joined-the-party/
