Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Big Players Back on Top: Large-Cap Stocks Dominate 2023 Returns Once Again

Published 04/26/2023, 07:41 AM
Updated 07/09/2023, 06:31 AM

Big-cap growth is back. After taking a back seat to various flavors of small-cap and value factors earlier in 2023, the large-company growth risk factor is again leading the horse race based on year-to-date returns for a set of ETF proxies through yesterday’s close (Apr. 25).

A month ago, it looked like the long-running domination of big-cap growth was faltering, inspiring a new round of forecasts that small-cap and value stocks would lead. But the tide has turned again, and iShares S&P 500 Growth ETF (NYSE:IVW) is the top performer so far this year.

After stumbling earlier in 2023 while small-cap-value stocks surged (IJS), big-cap growth has rebounded and is currently the top factor performer for 2023 with an 8.7% return. Meanwhile, small-cap value (IJS) has again fallen on hard times after a solid start to the year.

IWM Daily Chart

A close second to big-cap growth is iShares MSCI USA Quality Factor ETF (NYSE:QUAL) for year-to-date factor results. The fund, which targets companies with positive fundamentals, such as high return on equity and stable year-over-year earnings growth, is up 8.2%, just fractionally behind IVW.

Half of the factor opportunity set is in the red in 2022. The small-cap and momentum factors are suffering the most. Small-cap growth (IJT) is currently posting the biggest loss via a 2.1% decline so far this year.

The broad US stock market, based on SPDR S&P 500 (NYSE:SPY), is up a solid 6.6% year to date.

ETF YTD Total Returns

The recent upside momentum for factor funds has turned mixed lately, based on a set of moving averages that aggregate trend behavior for all the factor funds listed above. After a bullish recovery in short- and medium-term momentum, the short-term trend has fallen sharply, which suggests the market has turned cautious on the near-term outlook.

SPY vs Percentage of US Equity Factor Funds

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.