Re: Is the Small Cap Premium a Myth?
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That's why you diversify... the different types of stocks whether it be small vs large or value vs growth, or foreign vs domestic, etc... each outperform at various times relative to the other... so unless you want to start guessing which is going to have the outperformance, or actually spending the time to make informed decisions... it is best to simply diversify across, so that you capture a piece of everything [img]/images/graemlins/smile.gif[/img]
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Sniper, bonds have outperformed stocks at certain times, but that doesn't imply that they outperform stocks in the long run. If my risk tolerance can handle small caps, and they outperform large caps in the long run, then wouldn't it make sense for me to invest in a small cap index fund?
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