Source Library: Mid Caps Less Risky Than Large Caps?

Jodie Gunzberg, Managing Director at S&P Dow Jones Indices has written an excellent article about USA MidCap stock behavior. We found it interesting that earlier this year MidCap stocks had become overvalued and well ahead of LargeCap stocks. The MidCap stocks valuation corrected earlier this fall and returned to a lower relative valuation prior to November. In November MidCap stocks demonstrated the signs of lower volatility than their LargeCap colleagues which is discussed in Ms. Gunzberg’s paper. It will be interesting to see if there is a relationship between our relative valuations and increased or decreased volatility within an asset classification.