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The Russell 2000 (^RUT) is up 10% in 2024, which is far less than the 25% gain for the S&P 500 (^GSPC). Investors may want to start giving them a look though.
BTIG chief market technician Jonathan Krinsky observes that, historically, small caps "tend to start to move higher around this time of year. And that strength tends to lead until late January, early February. That's both in absolute terms and when you're comparing it to the S&P 500."
Krinsky thinks that financials and healthcare are the sectors to take a closer look at but cautions, "We really need to see interest rates moderate and probably pull back a little bit for the small-cap trade to work, and that should benefit those two sectors."
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This post was written by Stephanie Mikulich.