NYSEARCA:IWM

iShares Russell 2000 ETF (IWM)

291.17
-0.92 (0.31%)
as of Jul 24, 2026, 8:00:00 pm Market Open.
79 watching
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Investor Insights
star iconJul 25, 2026, 12:00 am

This summary was created by AI, based on 5 opinions in the last 12 months.

The iShares Russell 2000 ETF (IWM-N) has garnered attention from experts for its performance and potential in the small-cap sector. It has been recognized as a top pick, showing a notable 17% increase within a short timeframe, largely attributed to strong momentum in small-cap stocks compared to mid- and large-caps. Despite its sensitivity to interest rates and the absence of a downward trend in rates, analysts are optimistic, citing a broadening market rally and encouraging technical indicators with a significant percentage of stocks above their 200-day moving average. The ETF is considered cheap relative to the overall market and offers a diversification advantage, appealing to investors seeking exposure to small-cap stocks that historically outperform larger counterparts. With the potential for interest rate cuts, small-cap companies are viewed as poised for significant gains, further enhancing their attractiveness in the current economic climate.

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Consensus
Positive
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Valuation
Undervalued
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TOP PICK

20% off all time share price high.
Market rally will lift shares to new records.
Small cap indexes presenting opportunity.
Better diversity in companies that make up index. 

TRADE

Financials, energy and utilities will see a catch-up trade in the second half of 2023. Certain cyclicals will perform. IWM saw good support at $180 and could top at $195-199. But the Russell 2000 is extremely sensitive to interest rates, and a third of the index is not profitable (those companies). The GDP is also expanding, though, but she thinks GDP will slow while rates stay at 5-5.5%. Overall, not a great environment for small caps and cyclicals. But there will be a catch-up trade in cyclicals in Q3, then it peters out.

COMMENT
A lot of put-buying last Friday and today we're seeing those returns. The first trade he saw today were 30,000 IWM puts. IWM covers the Russell 2000, down 4% today as of noon.
DON'T BUY
Half of the companies in this index don't make any money. Only works when speculation and economic growth is in front of us. Not the moment to buy. Mid-cap companies ETFs like the S&P 600 are more interesting.
BUY
IWM small-caps, healthcare, banks and real estate. He's moving into small-caps for the next 12 months, doing less trading and more long-term investing.
COMMENT
You could buy the reverse, RWM, if you want to short the IWM. There is no leverage and it is an 1-1 inverse fund.
COMMENT
IF the economy is expanding, why are small caps underperforming? He uses the IWM as a proxy or hedge to emerging markets. IWM is in purgatory since rates peaked in the spring. No, IWM isn't falling off a cliff, but the future of smallcaps is unknown.
COMMENT
If the economy is expanding now, this could be a great economic opening, so why are small caps underperforming? He uses the IWM as a proxy and sometimes a hedge to emerging markets, because EM growth has been often tied to U.S. small-cap growth. IWM is in purgatory ever since rates peaked in the spring. No, IWM isn't falling off a cliff now and there could be re-acceleration, but the future of smallcaps is unknown.
COMMENT
As a barometer of the Russell smallcap index He's too deep in value which had a nice bounce, but investors then reversed that trend to go back into growth. IWM has been in a trading range, sideways, but it touched the 200-day moving average and did not break down, so it means it is building strength. Interest rates need to rise for IWM and the Russell 2000 to break out.
WEAK BUY

It gained today. It's an important indicator, reflecting the Russell smallcaps. Last September, the Russell and IWM exploded up, but since January this has been rangebound at $210-235. AMC, healthcare, financials, industrials and tech dominate the IWM. If this breaks $235, then the S&P is off to the races.

TOP PICK
Small cap stocks in the US. It has been hit the hardest. It is a great place to come out of this. Buy it lower than today.
PAST TOP PICK
(A Top Pick Dec 04/19, Down 19%) Mid-Dec to early-March is seasonality when it outperforms the market--which is something you want, not merely making market gains. However, this year, there wasn't buying demand for small caps. He sold this.
TOP PICK
This is the catch-up trade, anticipating the rotation from the winners to the losers. The Russell has underperformed this year but has just broken out. There was a massive consolidation this summer. He wouldn't be surprised if a wider pullback, pulled this back too. Nov.9-April 3 is seasonality for the Russell 2000.
DON'T BUY
Look at the 2-year chart, which is not reaching new highs like the rest of the American market. Instead, buy the strongest index, the S&P. Also look at a mid-vol or low-volatility US ETF for safety. Avoid cyclicality.
WATCH
It is a single inverse short ETF to the Russell 2000, no leverage. He is currently short the NAZDAQ. This ETF made a top with the market. If the current support in the Russell 2000 breaks than we could easily see the December lows in the market.
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