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The Fed kept key interest rates unchanged at 5.25%-5.50%. While the Fed ruled out the possibility of a rate hike going forward, it refrained from giving cues about a rate cut, due to sticky inflation and economic resilience.
Launched on 05/22/2000, the iShares Russell 2000 ETF (IWM) is a passively managed exchange traded fund designed to provide a broad exposure to the Small Cap Blend segment of the US equity market.
IWN's underlying index, the Russell 2000, includes a growing number of unprofitable companies. Unprofitable companies are riskier and more difficult to value, and they tend to underperform profitable ones, making IWM a riskier investment option. Investors can choose small-cap ETFs with profitability screens, such as IJR and AVUV, which avoid investing in as many unprofitable companies as IWM.
Volatility has increased on Wall Street, and many investors wonder if indices could decline double digits or even crash in the coming weeks. While a steep fall in stock prices can undoubtedly disrupt portfolios, astute investors recognize such a decline as an opportunity to acquire high-quality assets, including small-capitalization (cap) shares, at attractive valuations.
Small cap stocks are trading at a historically wide discount to large caps. One prominent Wall Street analyst thinks small caps could soar 50% in 2024 in a big "catch-up" trade.
7 Microcaps To Buy Ahead Of Possible Russell 2000 Inclusion
George Soros' hedge fund is making big bets on stocks, though not nearly as big as those he made on global currencies. His biggest investment had been Splunk, a big data analytics firm.
Small caps have been relatively weak in 2024, but the iShares Russell 2000 ETF (IWM) is still a buy based on valuation and its diversified exposure. The first Fed rate cut is often a bullish catalyst for small caps, indicating a more positive outlook in the intermediate term.
Watching certain instruments for clues on next moves, probably the best (equities) to watch is the Economic Modern Family of stock market ETFs. These ETFs cover everything from tech to regional bank stocks to small cap stocks to retail stocks and more.
What To Buy After You Sell The Russell 2000