Focus: How Do SmallCap Shares Perform In The Long Term?

This is the question posed by Thomas A. Klitbo and Torsten Bech, Equity Analysts in Jyske Bank in Focus no. 82, which is published today.

In the article the analysts examine, among other things, if the so-called SmallCap effect, which refers to the relatively higher price increase measured in market value, can also be traced in other markets than the Danish market. The SmallCap effect has been evident on the Danish equity market in recent years, and the KFX Index has not been able to stand the pace.

Klitbo and Beck also take a closer look at the ‘small’ shares historic performance on the Danish equity market and compare it to the performance of similar shares abroad.

The overall conclusions of the analysis are:

1. The SmallCap effect is not only a Danish phenomenon, but is also seen in Europe and the USA
2. Danish SmallCap shares underperform the general market in periods with declining key indicators, and
3. Danish SmallCap shares outperform the general market in periods with high investment returns.

Read the article ’How do SmallCap shares perform in the long term?’ in Focus no. 82 at the website of the Copenhagen Stock Exchange www.cse.dk. Questions to the authors may be sent to the e-mail address info@cse.dk until 21 May