Prediction: This Lesser-Known Growth ETF Will Crush the S&P 500 Over the Next 20 Years
Small-cap growth stocks might beat the biggest names on Wall Street for decades to come.
Many investors are contemplating whether the stock market is currently in a bubble. The S&P 500 index is a primary focus, having grown by approximately 12% year-to-date. However, some investors harbor concerns over metrics like the Shiller CAPE ratio, suggesting a potential bear market ahead. If you harbor doubts about the S&P 500's overvaluation and concentration, if you're apprehensive about the artificial intelligence boom not yielding returns for the dominant tech companies investing heavily in AI, data centers, and semiconductors, then you may consider investing in smaller-cap stocks.
Indeed, small-cap stocks could prove to be a superior investment choice over the next two decades. Vanguard's recent market forecast indicates that U.S. small-cap stocks are projected to outperform U.S. large-caps over the next 10 and 30 years. According to this forecast, small-caps may deliver an expected average annual return of 5.1% to 7.1% over the next 30 years, surpassing the projected annualized return range of 4.6% to 6.6% for large-caps.
Written by urgent.news from Motley Fool's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
