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Any reason to own small-cap fund and mid-cap fund if you already have a total market fund?
Posted on 7/2/26 at 3:25 pm
Posted on 7/2/26 at 3:25 pm
Thank you.
4
Posted on 7/2/26 at 3:36 pm to Zachary
Because a cap weighted total market fund relatively little mid and small cap exposure.
For instance, Vanguard Total Market E%F (VTI) is nearly 90% Large Cap according to:
https://www.etfrc.com/VTI
Large cap (>$10bn) 89.4%
Mid cap ($2-10bn) 5.0%
Small cap (<$2bn) 1.1%
ETA: I am almost exclusively in VTI and S&P500 funds very little in small/mid/int'l/individual stocks
For instance, Vanguard Total Market E%F (VTI) is nearly 90% Large Cap according to:
https://www.etfrc.com/VTI
Large cap (>$10bn) 89.4%
Mid cap ($2-10bn) 5.0%
Small cap (<$2bn) 1.1%
ETA: I am almost exclusively in VTI and S&P500 funds very little in small/mid/int'l/individual stocks
This post was edited on 7/2/26 at 4:37 pm
Posted on 7/2/26 at 3:47 pm to Zachary
Small cap shite is bait. All the money is flowing in and out of large cap.
The IWM weekly chart looks good, but, the opportunity cost is too high.
I vote no
The IWM weekly chart looks good, but, the opportunity cost is too high.
I vote no
Posted on 7/2/26 at 5:26 pm to jefforize
big money is made when small/mid caps become large caps. But it’s hard to capture that in an index fund.
on the other hand, owning the SP500 index or the total market index is basically the same as owning a large cap fund, they both own the same companies at the top and are heaving weighted to those same. So it seems logical if you want to spread out your money to own some small cap exposure.
You certainly can make the case that when (not if) the mega cap companies enter a bear market you’d want to be deployed in alternative investments as well
on the other hand, owning the SP500 index or the total market index is basically the same as owning a large cap fund, they both own the same companies at the top and are heaving weighted to those same. So it seems logical if you want to spread out your money to own some small cap exposure.
You certainly can make the case that when (not if) the mega cap companies enter a bear market you’d want to be deployed in alternative investments as well
Posted on 7/2/26 at 8:22 pm to Zachary
You own a fraction of all US stocks in total market fund.
I’d go a bit further…
Geography (US and Int’l - EU and emerging mkts)
Large and small cap (Russell 2000)…small cap betas are different that large cap - a good diversification tool.
Real Estate
Etc
Have AI do a diversification and correlation assessment of your funds. See where you may be over concentrated and duplicated. Or strategically over concentrated.
Depending on if you are in accumulation mode and your runway length to needing the money, you may or may not want natural hedging within your portfolio (ie, low correlation).
AI is pretty good at this level of analysis.
I’d go a bit further…
Geography (US and Int’l - EU and emerging mkts)
Large and small cap (Russell 2000)…small cap betas are different that large cap - a good diversification tool.
Real Estate
Etc
Have AI do a diversification and correlation assessment of your funds. See where you may be over concentrated and duplicated. Or strategically over concentrated.
Depending on if you are in accumulation mode and your runway length to needing the money, you may or may not want natural hedging within your portfolio (ie, low correlation).
AI is pretty good at this level of analysis.
This post was edited on 7/2/26 at 8:27 pm
Posted on 7/2/26 at 8:29 pm to Zachary
I agree with the others.
Small to mid cap (SMID) is for stock picking. Thats where most of the gems are, but as an index, I’ve never loved it.
Small to mid cap (SMID) is for stock picking. Thats where most of the gems are, but as an index, I’ve never loved it.
Posted on 7/2/26 at 8:52 pm to bayoubengals88
quote:
Small to mid cap (SMID) is for stock picking
This
Most small caps get absoultely wrecked when things turn sour, which is due any moment now
Posted on 7/2/26 at 9:05 pm to CecilShortsHisPants
About 15% of my 401k is in small/mid cap. Is it time to transfer out of that into large cap?
Posted on 7/2/26 at 9:15 pm to meeple
quote:
About 15% of my 401k is in small/mid cap. Is it time to transfer out of that into large cap?
That’s entirely a personal question. Small/mids offer more upside with greater risk.
FWIW, I’m 37, and 100% of my 401k is an S&P fund
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