"Small-Cap Funds Are More Promising Than They Have Been in Years. Here Are the Ones to Buy."
Portfolio Manager Fred Stanske, CFA, talks to Barron's about the Fuller & Thaler Behavioral Small-Cap Growth Fund
“If we have a hard landing, I think portions of the small-cap universe will do poorly,” says Fred Stanske, manager of Fuller & Thaler Behavioral Small-Cap Growth (FTXNX). “If you’re going to buy a small-cap portfolio right now, you’d want to lean toward more-profitable companies. Those companies will probably still make money in more difficult times.”
Stanske points out that 41% of companies in the Russell 2000 small- cap index are unprofitable, versus only 17% in the large-cap Russell 1000. That makes Russell 2000 index funds a poor choice for today’s fragile economic environment."