Traders work on the floor of at the closing bell of the Dow Industrial Average at the New York Stock Exchange on October 31, 2018 in New York.
Bryan R. Smith | AFP | Getty Images
The performance gap between small caps and large caps is widening to historic lows, a trend seen during times of economic stress and investor caution, possibly signaling something worse with the economy could be coming.
The small-cap benchmark Russell 2000 is in correction territory, trading nearly 14% below its 52-week intraday high in August 2018. Tthe S&P 500 is only off by 4% from its high. Something doesn’t add up.
“Large cap outperformance of small caps is reaching historic levels, and is noticeably a…