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!
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.