IWM Stock Recent News
IWM LATEST HEADLINES
Since my last writings, the latest dividend declarations and also interest rate changes have made small-cap one of the most attractive market sectors. I thus see attractive valuation in both IJR and IWM. However, a few differences between these funds make me prefer IJR.
The Russell 2000 index crashed for the second consecutive week as the fear and greed index moved to the extreme fear level. The closely-watched iShares Russell 2000 ETF (IWM) plunged to a low of $212 on Thursday, down by over 13% from its highest level this year, meaning that it is in a technical correction.
I maintain a buy rating on IWM due to its low valuation and potential for significant upside despite recent technical weaknesses. IWM has underperformed the S&P 500 but has outpaced the S&P SmallCap 600 ETF, showing resilience despite a high percentage of unprofitable firms. Long-term prospects for IWM are strong, with an expected 8% annualized return over 10 years, supported by a low forward P/E ratio.
SMIDcap stocks may hold particular appeal for investors this year, given large- and megacap concentrations in major indexes. The T. Rowe Price Small-Mid Cap ETF (TMSL) is worth consideration, given its outperformance within the category.
The tit-for-tat tariffs ignite fears of a trade war, prompting investors to dump riskier assets and take a flight to safety.
The iShares Russell 2000 ETF (IWM) crashed hard in the futures market as investors dumped small cap stocks. It dropped to $221.60 on Monday, its lowest level on January 14.
Chris Rokos is the founder of London-based hedge fund Rokos Capital Management.
The final trades of the day with CNBC's Melissa Lee and the Fast Money traders.
The iShares Russell 2000 ETF has been stagnant since February 2021, with rising interest rates and falling 2025 earnings estimates adding to investor frustration. Valuations are stretched, with a 12-month P/E ratio at 26.2, significantly above its historical median, making a compelling case for investment weakness. Tight credit spreads, historically low at 2.56%, limit the potential for P/E multiple expansion, suggesting limited upside for the ETF.
Despite the choppy price action in equities, it's too early for bulls to throw in the towel. Deescalating Middle East tensions, tamed inflation, and a washout in the number of new lows suggest the bull market has legs in 2025.