When To | Buy Small Cap Funds
: Historically, small-caps have outperformed large-caps in the months following a Federal Reserve interest rate cut .
Small-cap companies typically carry more debt relative to their earnings than large firms. Because of this, their performance is highly sensitive to the cost of borrowing: when to buy small cap funds
As the economy stabilizes and demand improves, smaller, more agile firms can see revenue and profit grow more sharply than their massive counterparts. when to buy small cap funds
When large-caps have dominated for a long period—as they have for over a decade—the can widen significantly. when to buy small cap funds
Market cycles of outperformance for small-caps vs. large-caps last about on average.