The Investopedia Express with Caleb Silver

Behind the Historic Small Cap Breakout, and Investing Lessons for Millennials

Jul 22, 2024

Callie Cox, Chief Market Strategist at Ritholtz Wealth, discusses the recent breakout in small cap stocks and the positive impact of lower interest rates on investors. She advises Millennials on portfolio diversification beyond the traditional 60/40 split. The podcast explores market trends, earnings surprises, interest rate effects, and the importance of diversification in real estate and global markets.

34:18

Episode guests

Callie Cox

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Episode notes

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Quick takeaways

Investors are favoring small-cap stocks due to lower interest rates, creating opportunities for growth.

Millennials advised to diversify portfolios beyond traditional 60/40 split, focusing on various company sizes and global assets.

Deep dives

Market Trends and Sector Rotation

Sector rotation and market trends are observed, showcasing a shift in investor behavior towards small-cap stocks as interest rates decline. The podcast highlights the historic breakout of small-cap stocks, with the Russell 2000 outperforming major indexes substantially, indicating a favorable market environment for smaller companies due to lower rates and improved economic conditions. The discussion delves into the impact of interest rate changes on various sectors, emphasizing the opportunities and risks associated with sector rotation and market dynamics.

Inflation Impact on Budget and Economic Perception

00:37

Timing is Everything in Market Trends

00:38

Small Caps Perform Best Under Specific Economic Conditions

00:42

Intro

4min

Analysis of Current Market Trends, Hedge Fund Behavior, and Investor Sentiment

4min

Market Earnings, Economic Events, and Investing Optimism

3min

Stock Market Movement and the Impact of Interest Rates

13min

Real Estate Investing Misconceptions and Diversification Strategies

7min

Exploring Finance Terms and Their Impact on Economic Indicators

3min

Callie Cox, the new Chief Market Strategist at Ritholtz Wealth, rejoins The Express to unpack the historic break out in small cap stocks of late, and why the prospect of lower interest rates is actually good news for investors seeking balance. Plus, Callie's advice to Millennials looking to build a balanced portfolio that doesn't look anything like their parents' standard 60/40. And, some weeks last a decade, and last week was one of them.

LINKS FOR SHOW NOTES

https://www.pionline.com/hedge-funds/hedge-funds-post-pretty-strong-performance-midway-through-2024-return-58

https://advantage.factset.com/hubfs/Website/Resources%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_071924.pdf

https://www.investopedia.com/ecb-holds-interest-rates-at-record-highs-lowers-inflation-forecasts-8605578

https://www.investoped...ition-8601178

https://www.ritholtzwealth.com/team/callie-cox

https://x.com/callieabost

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