Summary
- The National Bureau of Economic Research takes time to define periods of economic expansion and contraction - and they do so in hindsight; equity markets are not trading based on these characterizations.
- The low degree of difference between the S&P 500 Index and the WisdomTree U.S. LargeCap Index led to a low difference in performance between these Indexes across the different types of environments defined by the leading indicator.
- Based on roughly 16 years of live performance, we see yet another example of the differentiation that can occur with a thoughtful approach to small-cap stocks.
For further details see:
Can You Time An Earnings-Weighted Approach?