Bloomberg Intelligence's 'Equity Market Minute' 05/06/2020

The video discusses the recent rise in small cap stocks amid skepticism due to the poor economic climate. It highlights the impact of the Fed's announcement to purchase corporate credit, which benefited small caps. Historically, small caps have outperformed large caps after major peaks in credit spreads. The video also analyzes the valuation gap between small and large caps, noting that small caps are trading at a significant discount. The conclusion emphasizes the potential for this gap to close if economic conditions improve.

What does the enterprise value relative to sales ratio indicate about small caps compared to large caps?

What implications does the current discount of small caps to large caps have for investors?