Best ETFs in Small-Cap, Mid-Cap Space
"If you believe the credit crisis is not over, small-caps would be a better place to hide than large-caps," McClatchy said. "The market has been so fixated on weakness in the financial sector and on commodities that attention has been driven away from the difference between these asset classes."
There are some obstacles that will likely remain in the way for both small-caps and large-caps.
"Valuations seem to be improving, but sentiment does not," said Robert Maltbie, Managing Director of Singular Research, an independent research firm that focuses on small-cap companies. "It has been a fairly garden variety bear market and we are probably only about half way through it. There has been a continued economic slowdown from higher oil prices."Maltbie notes that small-cap companies with a global reach have been holding their ground, but current market conditions might play into the hands of investors who choose to go with individual stock picking as opposed to ETFs. "We are finding companies with exposure to emerging markets are working," Maltbie said. "It is a real stock picker's market right now though." Maltbie looks for names that beat their estimates by sizable margins. Two small-cap names on his radar right now are Graham (GHM) and Balchem (BCPC). Graham is a manufacturing company that has seen strong growth in the sale of its vacuum and heat transfer equipment. "Its growth is more of a secular trend than a cyclical trend," Maltbie said.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV