Everyone likes a good small capped stock. One that goes from $10 to $50 without a reason or a care in the world. However, over the past year, according to Exodus, the median return for 3,391 stocks with market caps under $5 billion, was an appalling -21%. If you drill down deeper, upping the degeneracy by lowering the market cap threshold to just $1 billion, losses for over 2,200 stocks exceeded 29% for the past 12 months.
According to Barclays, “the fun”, as some prominent bears call it, might just be getting started.
The majority of bear market declines, for small caps, went lower by 30%, meaning we might be due for another leg lower.
Conversely, larger cap stocks tend to do much better during market squalls. Stocks with market caps over $5 billion were down 8.8% over the past year, encompassing 887 stocks.
Year to date, large cap stocks are down 7.8%, while small capped are down 11.5%, narrowing the 1 yr performance spread from 13% to just 3.7%–indicative of the broad based sell off we’ve all been enjoying in these first few “fun” weeks of 2016.
If you enjoy the content at iBankCoin, please follow us on Twitter
What a day.
OK OK before this Bear (Me) gets to giddy, I still have to deal with BoJ this week. Gossip was that they were not planning ANYTHING this month, but OMG now some stupid gossip is saying there is a 50/50% chance of an Arrow being thrown at me.(lol, mainly Bank of Japan will add to their QQE program..they add an extra Q to their QQE, lol). HILSENRATH has already told us what the FOMC will say and do for the Fed Meeting, and market isn’t that wild about that at all. For the Small Caps, like duh, market topped out at SPX 1755, but they never told the big names yet, lol.
Next few week are going to be a chop fest I think.
Still don’t understand why you went 200% long when you are so continually pessimistic about the financial markets.
We have all been trained to buy the dip
I am not 200% long. I am now 75% SPY, 25% TLT.
The program buying was prescribed by Exodus. I am exiting on decent terms.
financials are LEADing
Bears and insults fill the comments section. I feel like I am driving through the bad part of town.
+1
Oh goody, Barclay learned how to read charts like the rest of us.