NEW YORK ( TheStreet) -- Small stocks were clobbered during the volatile markets of last year. In the third quarter, small blend funds lost 21%, according to Morningstar. For 2011, the funds lost 4.1%, trailing the S&P 500 by 6 percentage points.Investors should not be surprised by the turbulent performance of small-cap funds. Many academic studies have shown that small-cap funds can be more volatile than large stocks. During rough times panicked investors can suddenly dump little-known small stocks and take refuge in giant blue chips, which seem like safer bets.
3 Small-Cap Funds Delivering Steady Performance
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