5 Stocks That Pushed Russell 2000 ETF Higher

The latest U.S. stock market rally seems to be spreading across all market capitalizations with small-cap stocks taking the center stage this week. This is especially true as the Russell 2000 Index hit new 52-week high, having gained about 20% so far this year. However, the benchmark is still lagging its large-cap brethren and below nearly 7% from its all-time high set on Aug 31, 2018.

Most of the rally was driven by its attractive valuation, which has provided investors a nice opportunity to snap them at a relatively lower price versus large-cap cousins in a skyrocketing market. Then, easing monetary policy has been the biggest catalyst. The central bank has slashed interest rates two times this year to sustain the decade-long economic expansion. Lower interest rates bode well for the pint-sized stocks, perking up economic activities and resulting in higher spending, thus boosting domestically focused companies.

Further, the latest bouts of data, which indicates renewed economic growth, are adding to the strength.

Given this, iShares Russell 2000 ETF (IWM - Free Reporttracking the Russell 2000 Index has rallied about 22% so far this year to hit a new one-year high. Let’s take a closer look at the fundamentals of IWM and its performance.

IWM in Focus

This is one of the largest and the most popular ETFs in the small-cap space with AUM of $45.5 billion and average daily volume of 19.2 million shares. Holding 1984 stocks, the fund is widely spread across components, with each holding less than 0.4% share. Financials (17.8%), healthcare (17.5%) industrials (16.1%), information technology (13.7%) and consumer discretionary (11.0%) are the top five sectors. IWM charges 19 bps in annual fees and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. 

Though most stocks in the fund’s portfolio are moving north this year, we have highlighted the five best-performing stocks in the ETF that have led the way higher:

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