Macro Commentary: Small Caps' Potential as Margin Spreads Widen

20 days ago

Ben

"One more. Um I like small caps going into 2026. There I said it. Can't help it. Man, Matt has a chart case last week. Remember, Matt has a chart showing that the profit margins for the S&P 100 versus the S&P 600. The spread is basically at an all-time high with 15.7% for the S&P 100 and just 5.9 for the S&P 600, while the S&P 600 margins peaked 3-4 years ago."

The speaker expresses a bullish macro view on small cap stocks heading into 2026, highlighting an all-time high margin spread between large cap (S&P 100) and small cap (S&P 600) companies. The widening spread, along with historical data on profit margins, supports the notion that small caps may deliver attractive performance going forward.

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