Take a Tour of Smallville
One of the interesting facets of the market mini-purge that we've experienced over the past two months is that as a group, the smallest names are not getting punished to a much greater extent than the bigger names. I can point to several small individual names that have had the stuffing knocked out of them, but in general, the punishment has been no different in Smallville. Case in point, the Russell Microcap Index is down about 9.4% since April 2, which is on par with the S&P 500's performance. I don't remember the last time that happened.
Keep in mind that the Russell Microcap Index is comprised of the 1000 smallest companies in the Russell 2000 Index, and represents less than 3% of total U.S. equity market cap. Just how small are the names in the Index? The weighted average market cap is $364 million, while the median market cap is just $153 million. The largest name has a market cap just under $1.9 billion. This is right up my alley. It's certainly not for everyone, and if you want exposure to this index but not necessarily individual names, you can get it via the iShares Russell Microcap Index (IWC), also known as beta in my world....257 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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