Quote:
Originally Posted by tom2021
Since Mid 2021, SP 500 performs much better than Russel 2000.
Will Russel 2000 catch up?
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I used to always hold a decent amount in small cap funds, as they performed better than S&P and many other sectors. The "word" is that small caps perform better in an environment with rates coming down. Maybe they will outperform again.
I still have a small allocation to OTCFX. It underperformed nearly every other sector fund that I own in 2023 and YTD 2024. And for the past 10 years. I will likely sell the remainder soon, after retirement, when the cap gains will have less tax consequences. One advantage of holding small caps in a taxable account is little/no dividends on an annual basis.
Another way to get small cap exposure is through an
extended market index fund.