Snapshot of U.S. Equity Styles/Market Caps

Bob Carey
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Snapshot of U.S. Equity Styles/Market Caps

Posted Under: Themes

View from the Observation Deck

Today's blog post is intended to expose potential opportunities within the growth and value styles of investing, as well as by market capitalization (market cap).
At any given time, the equities markets are likely being led up or down by one of the three market cap classifications (large-cap, mid-cap or small-cap). Often this leadership role can be held for a multi-year period.
From 1995-1999, large-cap stocks outperformed their mid- and small-cap counterparts by a sizable margin. From 2000-2012, mid- and small-caps outperformed large-caps by an even bigger margin.
From 12/31/12 through 3/11/15, however, the S&P 500, S&P MidCap 400 and the S&P SmallCap 600 indices posted similar cumulative total returns of 49.78%, 50.05% and 50.31%, respectively.
As indicated in the chart, the S&P MidCap 400 Growth Index has been the best performer in 2015 (thru 3/11).
Four of the six indices have double-digit 2015 earnings growth rate estimates and four of the six have 2015 estimated P/E ratios below their respective three-year averages.

This chart is for illustrative purposes only and not indicative of any actual investment. The illustration excludes the effects of taxes and brokerage commissions and other expenses incurred when investing. Investors cannot invest directly in an index. There can be no assurance that any of the projections cited will occur. The S&P 500, S&P MidCap 400 and S&P SmallCap 600 style indices are capitalization-weighted indices designed to measure large-capitalization, mid-capitalization and small-capitalization U.S. stock market performance.

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Posted on Thursday, March 12, 2015 @ 2:51 PM • Post Link

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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

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