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The small-cap index Russell 2000 recently witnessed its most impressive week in over two years as investors bet on the Federal Reserve's halt in its interest rate hike cycle.
SQLV has been managed actively since May 2022; the strategy is small-cap universe-centered, with value and quality screens mindful of FCF and ROIC. A strong value and quality mix is under the hood, manifested in a high earnings yield, remarkable ROE, and significant presence of players with strong earnings quality. Performance is not as robust as it might be though.
Small-cap stocks and ETFs have been gaining strength lately on the signing of the debt deal, upbeat U.S. jobs data and chances of no rate hike this week.
The Royce Value Trust CEF invests in value-oriented stocks of small-cap and micro-cap companies. The fund benchmarks the performance of its portfolio against the Russell 2000 Index. The Royce Quant Small-Cap Quality Value ETF is under the Legg Mason ETF Investment Trust. The fund also benchmarks the performance of its portfolio against the Russell 2000 Index.
The broader market kicked off 2023 on a moderate note. These ETFs can be good picks for the month January.
Launches continued at a steady pace, but there were very few other goings-on in the ETF space.
Data on the rotation between small-cap growth and value stocks goes back decades. Looking back over 40 years, small value beat small growth about two-thirds of the time.
Wall Street snapped a three-week winning streak amid uncertainty over the global growth and inflation fears.