EXCLUSIVE: 'Fed Pivot May Be Imminent' — Small Caps Are Poised For Big Comeback, Says WisdomTree Strategist
Portfolio Pulse from Surbhi Jain
The Russell 2000 has surged over 10% in July, driven by a rotation trade and anticipation of a Federal Reserve pivot. The iShares Russell 2000 ETF (IWM) and Vanguard Russell 2000 ETF (VTWO) gained over 11%. WisdomTree's Brian Manby highlights the potential for small-cap stocks, particularly the WisdomTree U.S. SmallCap Quality Dividend Growth Fund (DGRS) and the WisdomTree U.S. SmallCap Quality Growth Fund (QSML), to benefit from potential interest rate cuts and a soft landing by the Fed.
August 08, 2024 | 5:52 pm
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POSITIVE IMPACT
The WisdomTree U.S. SmallCap Quality Dividend Growth Fund (DGRS) is highlighted as a promising small-cap stock, trading at about 13x earnings.
DGRS is highlighted for its growth potential and attractive valuation, making it a promising investment amid the current market conditions.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
The iShares Russell 2000 ETF (IWM) gained 11.27% in July, driven by a rotation trade and anticipation of a Federal Reserve pivot.
The significant gain in IWM is attributed to a rotation trade and the anticipation of a Federal Reserve pivot, which has led investors to seek discounted valuations in small-cap stocks.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
The WisdomTree U.S. SmallCap Quality Growth Fund (QSML) is highlighted as a promising small-cap stock, trading at about 17.6x earnings.
QSML is highlighted for its growth potential and attractive valuation, making it a promising investment amid the current market conditions.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
The Vanguard Russell 2000 ETF (VTWO) gained 11.36% in July, driven by a rotation trade and anticipation of a Federal Reserve pivot.
VTWO's gain is driven by the same factors as IWM, with investors rotating into small-cap stocks in anticipation of a Federal Reserve pivot.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80