1 Vanguard Index Fund May Beat the S&P 500 by 100% in the Next Few Years, According to a Wall Street Analyst

Fundstrat analyst Tom Lee in November told CNBC that small-cap stocks are positioned to crush the S&P 500 (SNPINDEX: ^GSPC) due to relatively cheap valuations and interest rate cuts. "I think small caps, in the next couple of years, could outperform by more than 100%," he predicted.History supports the notion that small-cap stocks are headed for a period of outperformance. The small-cap Russell 2000 returned an average of 45% during the 12-month period following the last five rate-cut cycles. Meanwhile, the S&P 500 gained an average of 33%, according to Goldman Sachs.The Federal Reserve started lowering interest rates in September, but policymakers left rates unchanged in January. That does not necessarily mean the cutting cycle is over, but the downward trend is still good news for the small-cap Russell 2000. Investors can capitalize on its potential outperformance by owning shares of the Vanguard Russell 2000 ETF (NASDAQ: VTWO).Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool