Key Facts on Small-Cap Stock Performance
In 2026, small-cap stocks have outperformed large-cap stocks by the widest margin since 2003, with a year-to-date increase of about 13%. Despite this strong start, small caps still trade at a significant discount to the S&P 500, which may present further investment opportunities moving forward.
The Vanguard Small-Cap Value ETF (NYSEMKT: VBR) includes 835 smaller companies, mostly outside the tech sector, and has a median market cap of approximately $10 billion. The fund has an average price-to-earnings ratio of 17.8 compared to the S&P 500’s 28.1, and its low expense ratio of 0.05% makes it an attractive option for long-term investors.
While small-cap stocks are currently experiencing a resurgence, experts caution that factors such as interest rates could influence future performance. The ongoing valuation gap suggests potential for growth in the coming years.
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