From the beginning of this recent market pullback, small caps led the way lower. The small cap Russell 2000 index plunged nearly 12% between September 3 and October 13, for instance, while the blue chip Dow Jones Industrial Average was down less than 5% over that same stretch.
But suddenly small caps are enjoying a nice rally. Since its October 13 lows, the Russell 2000 has jumped 3.9% compared to a 0.9% decline for the Dow. On Wednesday alone, the Russell 2000 gained 1% while the Dow dropped 1.1%.
What do you think is behind the recent rally in small caps?
Is it suddenly "risk on" for stocks again? Or is this simply a relief rally for an area of the market that got crushed? Or is it something else?
Chime in below!
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.