Chuck Royce: U.S Small Caps Set To Outperform U.S Large Caps

In the latest Q&A with Chuck Royce and Francis Gannon at Royce, Chuck Royce discusses why U.S small caps are positioned to outperform U.S large caps. Here’s an excerpt from the Q&A:

Royce: It’s admittedly a bit of a mixed picture. We’re in an odd position where, for many people in the world, the last 18 months have been an extremely difficult period because of the pandemic. However, for investors, particularly those in the U.S., the trailing returns are very, very good.

Going forward, I expect U.S. investors will need to temper their expectations. A lasting return to normal will be very welcome news, even if the prospective results for stocks are not as high as they’ve been for many investors.

Within the U.S. capital markets, however, I’m confident that small caps are positioned to outperform U.S. large caps, as well as domestic fixed income and cash. I think investors should feel very comfortable with their U.S. small cap allocations. I’d also add that it’s historically during less robust performance periods that active management has added the greatest value—and we look forward to doing so for our investors.

You can read the entire Q&A here:

Royce: Q&A with Chuck Royce and Francis Gannon