SOURCE: Russell Investments

Russell Investments

September 09, 2014 10:10 ET

U.S. Small Caps on the Fence: Russell 2000® Index in Positive Territory for 2014 as of August 31; What Happens for the Full-Year May Depend on September Index Performance

SEATTLE, WA--(Marketwired - Sep 9, 2014) -  After a volatile year-to-date of ups and downs for the U.S. small-cap Russell 2000® Index, the Index finished August in positive year-to-date territory at 1.8% as of August 31.

Whether the Index will show a positive return for 2014 may depend on how it has performed year-to-date but, even more importantly, potentially on how it performs in the month of September.

Russell Indexes examined Russell 2000® Index returns from 1999 through 2014. Of the 9 positive September performances in the last 15 years, eight foreshadowed a positive year for U.S. small caps. And of the six negative September performances in the last 15 years, just two led to positive years. And, in the last 15 years, a positive year-to-date return for the Russell 2000® Index through August 31 led to a positive year seven out of ten times, while a negative year-to-date return through August 31 meant a negative year for the Index three of six times. 

"Of course, past performance is no guarantee of future results, but market indexes can be powerful tools and history teachers," said Tom Goodwin, senior indexes research director with Russell Investments. "In a year of more pronounced market ups and downs such as 2014, it is important for investors to have access to high quality index tools to help measure and track the continuing evolution of the markets."

History of U.S. Small Cap Performance: Russell 2000® Index

Russell 2000®Index   YTD as of Aug 31   September   Annual Return
2014   1.8%   ??   ??
2013   20.0%   6.4%   38.8%
2012   10.6%   3.3%   16.4%
2011   -6.5%   -11.2%   -4.2%
2010   -2.9%   12.5%   26.9%
2009   15.7%   5.8%   27.2%
2008   -2.6%   -8.0%   -33.8%
2007   1.4%   1.7%   -1.6%
2006   7.8%   0.8%   18.4%
2005   3.1%   0.3%   4.6%
2004   -0.9%   4.7%   18.3%
2003   31.0%   -1.8%   47.3%
2002   -19.3%   -7.2%   -20.5%
2001   -2.2%   -13.5%   2.5%
2000   7.3%   -2.9%   -3.0%
1999   2.4%   0.0%   21.3%

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

For more information on the Russell 2000® Index and the entire Russell Indexes family, go to the Russell Indexes website.

The Russell 2000 Index measures the performance of the small-cap segment of the U.S. equity universe. The Russell 2000 Index is a subset of the Russell 3000® Index representing approximately 10% of the total market capitalization of that index. It includes approximately 2000 of the smallest securities based on a combination of their market cap and current index membership.

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. 

Opinions expressed by Mr. Goodwin reflect market performance as of August 31, 2014 and are subject to change at any time based on market or other conditions without notice. Past performance does not guarantee future performance. 

Forecasting is inherently uncertain and may be incorrect. It is not representative of a projection of the stock market, or of any specific investment.

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.

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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.