Small Caps Lead the Way after a Recession

Last week I asked Ian Wyatt from to come and teach us a little about why small caps are perfect for active traders. It got a pretty good response, so today I invited him back to convince us that small cap stocks are our way out of the recession...please feel free to comment with your thoughts and opinions as it's YOU that drive this blog!


Investors and traders seeking to recover from the losses of the bear market need to consider small-cap stocks, due to their consistent out-performance following a downturn in the stock market.

Several recent studies show evidence that small-cap stocks are most likely to be the best performing among equities following a recession.

According to a T. Rowe Price report entitled, A Perspective On Financial Topics For Our Investors, in the 12-month period following the end of the last nine recessions, small-cap stocks on average gained 24 percent, compared with a 17.6 percent gain for the S&P 500.

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