Small Cap Stocks Are Just So Hot Right Now

The U.S. stock markets have been the envy of the world this year.

Within the those markets, small-cap stocks have been outperforming large-cap stocks.

"Client conversations this week focused on the drivers and sustainability of recent small cap performance," said Goldman Sachs David Kostin.

"The recently-reconstituted Russell 2000 has outperformed the S&P 500 by 580 bp in the last two months (12.1% vs. 6.4%) as both rose to new all-time closing highs. The Russell 2000 has returned 22% YTD vs. 19% for the S&P 500. The rally began at the same time we published our in-depth report on small caps."