What Do Small-Caps Tell Us About Broader Markets?

The video discusses the performance of small caps and other indices, highlighting the impact of interest rates and the Federal Reserve's policies. It explores how a stronger dollar affects small caps, noting their limited foreign earnings exposure. The discussion also covers market volatility and the potential for shifts in the SP 500 to Russell 2000 ratio.

What is the relationship between interest rate exposure and the performance of key indices?

• Higher interest rate exposure leads to worse performance.

• Interest rate exposure only affects the NASDAQ.

• Higher interest rate exposure leads to better performance.

• Interest rate exposure has no impact on performance.

What has the Federal Reserve been careful about regarding interest rates?

• Eliminating interest rates altogether.

• Keeping interest rates constant.

• Lowering interest rates gradually.

• Raising interest rates suddenly.

Which asset class was notably affected in July?

• Consumer goods

• Healthcare

• Utilities

• Technology stocks

How does a stronger dollar impact small caps compared to large caps?

• It has no impact on either small or large caps.

• It benefits large caps more due to more foreign earnings exposure.

• It benefits small caps more due to less foreign earnings exposure.

• It negatively impacts both small and large caps equally.

What level of the Russell 2000 index is crucial for potential market shifts?

• 1100

• 1300

• 1000

• 1200