U.S. Small Cap
Re-introducing the diversification potential of U.S. small caps
Why Aberdeen Investments for U.S. Small Caps
Experienced team
The team’s high conviction, active approach has delivered outperformance over time, with strong risk-adjusted returns.*
Global perspectives, local focus
Our global presence helps us make more holistic decisions; with an engaged U.S. team conducting hundreds of meetings per year.
Active insights delivered thoughtfully
Active approach focused on identifying quality small cap companies; and implementing our best ideas with conviction.
* Source: Aberdeen, As evidenced by our track record compared to the relevant benchmark
Why U.S. Small Caps
Portfolio diversification
Adding U.S. small caps to a portfolio may help reduce volatility, as they have different market dynamics compared to other asset classes.
Growth potential
U.S. small cap companies are often at the forefront of new technologies and evolving trends, offering potential for higher returns.
Active opportunity
With fewer analysts covering U.S. small cap companies, the asset class is ripe for an active management approach.
Why Small Caps Now
Relative valuations for U.S. small caps are near all-time lows
Chart 1. U.S. Small-Cap relative to U.S. Large-Cap forward price/earnings (PE) ratio
Source: FactSet, Bloomberg, abrdn, 31 December 2024. Past performance does not predict future returns. For illustrative purposes only. Projections are offered as opinion and are not reflective of potential performance. Projections are not guaranteed and actual events or results may differ materially. Note: Excluding negative earnings
Cyclical trends
Cyclical trends for the small cap asset class are favorable
Chart 2. Small-cap/Large-cap (1931 to 2024)
Source: Furey Research Partners, FactSet, 31 August 2024. Past performance does not predict future results
M&A activity has accelerated for small cap companies
Chart 3. M&A activity accelerating in small caps
Source: FactSet, Bloomberg, FTSE Russell, Jefferies, June 2024 Note: Data is annual deals in the Russell 2000; 2024 is through December 31st 2024
Insights and research
Digestible insights that offer investment opinions and views that can quickly add value to you and your industry.