The Russell 2000 is known as the US small-cap index. It’s made up of the smallest 2,000 companies by market capitalisation in the Russell 3000 index. These are not necessarily small-cap companies as we know them in SA. Many are fairly substantial in size, but measured against global conglomerates they compare as small caps on a relative basis.

The companies that fall into the Russell 2000 index are often more US-centric than those found on the S&P 500 or the Nasdaq 100. So the Russell 2000 is a fairly accurate indicator of the performance of companies with a domestic US focus. What is notable from the chart is that the performance of the Russell 2000 over the past year has been weaker than the S&P 500 and the Nasdaq 100. While those two are knocking on new highs, the Russell 2000 is languishing quite a long way below the high set in August 2018. This is likely an indication that the US economy has begun to slow over the past year. From a technical perspective, the chart of the...

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