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DR<>How Small Cap Stocks Saved the Market

The big boys have been kicking sand in the face of the small caps all year. On October 13th (the first day of the week when the market went haywire), the Russell was down nearly 10% year-to-date, compared to about a 2% gain in the S&P. No one wanted small cap stocks in their portfolio.

But just two weeks ago — when most investors saw nothing but chaos in the plunging market — I detected a “silent buy” signal on small cap stocks. (I mainlined a gallon of ice water when the market started collapsing. Having the stuff in your veins helps you keep cool when things start going to seed.) And within the next few days, the magic began to happen. The small cap stocks began to rise. Here’s what we were watching:

cont for full http://dailyreckoning.com/small-cap-stocks-saved-market/