SOURCE: Russell Investments

Russell Investments

January 10, 2014 09:49 ET

Global Small Cap Stocks Mostly Outran Their Large Cap Equivalents in 2013 & Continued Strong Relative Performance Year-to-Date, as Reflected by the Russell Global Indexes

SEATTLE, WA--(Marketwired - Jan 10, 2014) - Small cap stocks across a range of global regions outperformed their large cap counterparts in 2013 and many have continued this trend in 2014 as of January 7.

  • In Europe, the Russell Developed Europe Small Cap Index outpaced the Russell Developed Europe Large Cap Index by more than 10% in 2013. And in 2014 as of Jan 7, there was a 1.5% difference.

  • In the U.S., the small-cap Russell 2000 Index outpaced the large-cap Russell 1000 Index by more than 5% in 2013 and the indexes were even year-to-date as of Jan 7.

  • Globally, the Russell Global Small Cap Index outperformed the Russell Global Large Cap Index in 2013 and has continued to outperform in 2014 as of Jan 7. Small caps have also outperformed for these same time periods in emerging markets as reflected by the Russell Emerging Markets Index.

"The global large cap segment of equity market has become more highly correlated due in part to those companies diversifying their revenues and supply chains globally. The diversification and growth potential offered by international small cap investing has become a logical extension and possibly an under-explored area of potential opportunity for many global multi-asset investors. Russell's global indexes provide a globally consistent delineation between large caps and small caps across regions and countries, which provides investors with accurate and reflective indexes to measure and analyze these investment opportunities," said Mat Lystra, index research analyst with Russell Investments

For more information on global small cap equities and the Russell Indexes, go to the Russell Investments website.

Index 2014 YTD a/o Jan 7 2013
Russell Developed Europe Large Cap Index 0.3% 21.5%
Russell Developed Europe Small Cap Index 1.8% 33.8%
Russell 1000 Index 0.8% 27.4%
Russell 2000 Index 0.8% 32.8%
Russell Global Large Cap Index 0.3% 18.9%
Russell Global Small Cap Index 0.9% 19.9%
Russell Emerging Markets Large Cap Index -1.7% -4.9%
Russell Emerging Markets Small Cap Index 0.4% 1.1%

Source: Russell Investments. Returns are total returns (reflect reinvestment of dividends and distributions) and are denominated in euros.

The Russell Global Index measures the performance of the global equity market based on all investable equity securities, and is constructed to provide a comprehensive and unbiased barometer for the global segment, The Index includes more than 10,000 securities in 47 countries, and covers 98% of the investable global market. All securities in the Russell Global Index are classified according to size, region, country and sector; as a result the index can be segmented into more than 300 distinct benchmarks.

Please note: Indexes are unmanaged and cannot be invested in directly. Returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment. Russell's publication of the Indexes or Index constituents in no way suggests or implies a representation or opinion by Russell as to the attractiveness of investing in a particular security. Inclusion of a security in an Index is not a promotion, sponsorship or endorsement of a security by Russell and Russell makes no representation, warranty or guarantee with respect to the performance of any security included in a Russell Index. 

Small capitalization (small cap) investments involve stocks of companies with smaller levels of market capitalization (generally less than $2 billion) than larger company stocks (large cap). Small cap investments are subject to considerable price fluctuations and are more volatile than large company stocks. Investors should consider the additional risks involved in small cap investments.

Global equity involves risk associated with investments primarily in equity securities of companies located around the world, including the United States. International securities can involve risks relating to political and economic instability or regulatory conditions.

Opinions expressed by Mr. Lystra reflect market performance as of January 7, 2014 and are subject to change at any time based on market or other conditions without notice. Past performance does not guarantee future performance. 

This material is not an offer, solicitation or recommendation to purchase any security.

Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specific legal, tax and investment advice from a licensed professional. The information, analysis and opinions expressed herein are for general information only and are not intended to provide specific advice or recommendations for any individual entity.

Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company.