Small companies, big potential Small companies, big potential http://www.federatedinvestors.com/static/images/fed-logo-amp.png http://www.federatedinvestors.com/daf\images\insights\infographic\office-buildings-france-small.jpg May 17 2019 May 8 2019

Small companies, big potential

The best time to consider small caps? Any time.
Published May 8 2019
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Infographic published [insert publication date]. Title: Small companies, big potential. The best time to consider small caps? Any time. Small caps’ sheer numbers & lack of coverage create opportunities. There are 4,380 global small-cap companies versus 1,633 global mid- and large- cap companies. Bar graphs illustrate that analyst coverage dwindles with company size. The average number of analysts covering small-cap companies is six. The average number of analysts covering mid-cap companies is 13. The average number of analysts covering large-cap companies is 19. The percentage of small-cap companies without analyst coverage is 21.4%, compared to 5.1% of mid-cap companies and 4.2% of large-cap companies. Small-cap growth companies have outperformed over the long term. A chart shows an upward trend on both the Russell 2000 Growth Index and the S&P 500 Index over the time period of April 1, 2009 to March 31, 2019. Despite periods of volatility, the Russell 2000 Growth Index outperformed the S&P 500 Index over this 10 year period. Significant outperformance occurred on the following dates: On April 30, 2010, the Russell 2000 Index hit $16, 705 versus the S&P 500 Index at $15,213; On April 30, 2011, the Russell 2000 Index hit $21, 765 versus the S&P 500 at $17, 833; On July 31, 2015, the Russell 2000 Growth Index hit $35, 352 versus the S&P 500 at $30, 130; On January 31, 2018, the Russell 2000 Growth Index hit $45,118 versus the S&P 500 at $42, 624; On August 31, 2018, the Russell 2000 Growth Index hit $51,472 versus the S&P 500 at $44,323; On November 30, 2018, the Russell 2000 Growth Index hit $44,594 versus the S&P 500 at $42, 374; On February 28, 2019, the Russell 2000 Growth Index hit $46,768 versus the S&P 500 at $42, 974. On April 1, 2009, the Russell 2000 Growth Index and the S&P 500 Index had an initial value of $10,000. On March 31, 2019, the Russell 2000 Growth Index’s ending value was $46, 135, compared to the S&P 500 Index’s value of $46, 135. Disclosure: Past performance is no guarantee of future results. For illustrative purposes only and not representative of performance for any specific investment. Investments cannot be made directly in an index. Small company stocks may be less liquid and subject to greater price volatility than large capitalization stocks. Sources for this graphic include: Ned Davis Research, 2019; Thomson Reuters Institutional Brokers Estimate System, 2019.