Blog | What’s behind the US small-cap flameout?

A year ago, US small-cap stocks were riding high on the post-lockdown jubilance fueled by the news of a Covid-19 vaccine breakthrough. This January, US small caps led the collapse across global equity markets, even nearing bear market territory at one point during the month.

While US large caps have also struggled lately, they’ve fared far better than their smaller counterparts: the Russell 1000 fell 5.6% in January versus a drop of 9.6% for the Russell 2000. For the 12 months through last month, the Russell 1000 has climbed 20.3%, while the US small-cap index is down 1.2%.

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