Options Amid Uncertainty

In previous market declines and advances, small-cap stocks have often staged steep declines followed by furious rallies, as they are susceptible to the greatest degree of volatility in both bear and bull markets. A market selloff in May creates small-cap opportunities that appear attractive and likely to generate significant gains if the market climbs higher in the second half.

The same situation happened to small-caps in March 2009 and January 2012. Today, there are hints that the U.S. market could turn for the better later this year: housing is mending, job growth is improving, and the Federal Reserve will likely act if Europe continues to threaten the U.S. recovery. The longer the stock market declines, the greater the upswing will be....320 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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