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Index IDEA: US small cap shift in 2017

As we reach the midway point in 2017, the US small cap market continues its 180 degree shift from 2016, according to US small cap Russell 2000® Index.

In 2016, the Russell 2000 Index returns rose 21%, yet were clearly dominated by value-oriented, defensive stocks, not unexpected in a year which witnessed uncertainty around the Brexit vote in the UK leading into June and the uncertainty of the US presidential election leading into November .

Russell US Indexes 2016 Returns

Source: FTSE Russell. Data as of December 31, 2016 and derived from the Russell Index performance calculator. Past performance is no guarantee of future results. Please see the end for important legal disclosures.

In 2017 year-to-date, however, the tables have turned for US small cap stocks. The Russell 2000 Index has risen 5% in 2017 as of July 7, yet this rise has come predominately from growth-oriented, dynamically driven US small cap stocks.

Russell US Indexes 2017 YTD Returns

Source: FTSE Russell. Data as of July 7, 2017 and derived from the Russell Index performance calculator. Past performance is no guarantee of future results. Please see the end for important legal disclosures.

Experts from global index provider FTSE Russell and CME Group believe the performance shift for the US small cap equity market reinforces the need for the highest quality tools for investors looking to pursue market opportunities while managing downside risk.

Ron Bundy – CEO, North America Benchmarks, FTSE Russell, said:

“As evidenced by their abrupt shift in performance drivers in 2017, US small cap stocks are a very sensitive asset class and closely reflect shifting economic and political environments. This is why it is important for investors to have a high quality range of index tools allow them to properly measure and plan before investing in this critical asset class.”


Tim McCourt – Global Head of Equity Products, CME Group, said:

“The Russell 2000 Index is a powerful tool which can be used by investors to measure and manage their capital and risk exposure in the small cap segment.”

For information on futures and options based on the Russell 2000, go to the FTSE Russell website.

 

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Views expressed by Ron Bundy of FTSE Russell and Tim McCourt of CME Grouo are as of July 11, 2017, are subject to change and do not necessarily reflect the views of the London Stock Exchange Group.

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