Historically known for their potential to deliver higher returns, small-cap stocks have recently struggled against the backdrop of high inflation, rising interest rates, and a focus on mega-cap tech stocks. For the past years the MSCI AC World has outperformed the MSCI AC World Small Cap Index. This performance gap highlights the extent to which small-cap stocks have been overshadowed by larger, tech-driven companies and investors have been cautious. However, this landscape also presents a compelling and timely opportunity.

Current valuations of small-cap stocks suggest significant upside potential as is reminiscent of past periods following low performance. Analysts expect earnings growth for small-cap companies this year as financial conditions improve and access to capital becomes more favourable. The panel will delve into the current opportunities in small-cap investments and will explore strategies to identify small-cap companies that can accelerate their fundamentals in current economic conditions. The discussion will also address how to leverage and capitalise on the current market lag in the context of an investment strategy global view.

Hosted by the Financial Times in partnership with American Century Investments, this panel aimed to provide a better understanding of the small-caps market and its potential growth as well as insights into the strategic opportunities associated with small-cap investments.

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