Get Ready for Short Squeezes to Take Small-Cap Stocks Higher

As I pointed out in a previous column, the Street has become significantly less fearful of small-cap stocks and medium-cap stocks than in 2022 and the first 10 months of 2023. Still, those equities continue to meaningfully outperform their large-cap peers. Over the longer term, however, the bears driving the small-cap and mid-cap names down through short selling will likely give up their efforts, enabling many of those stocks to undergo huge short-covering rallies. Additionally, rate cuts by the Federal Res ...