Russell beating the NDX on the one year chart (in percentage) may seem like a minor victory, but upon closer inspection, it reveals some significant trends and patterns. In this blog post, we’ll take a deeper dive into the chart to uncover the reasons behind Russell’s success and what it could mean for investors moving forward.

Firstly, let’s take a look at the chart itself. The image provided shows the one year performance of both the Russell 2000 Index (RUT) and the NASDAQ Composite Index (NDX). At first glance, it appears that RUT has outperformed NDX by a significant margin. However, upon closer inspection, we can see that this is not entirely accurate.

When we look at the chart more closely, we can see that RUT’s performance has been steadily increasing over the past year, while NDX has experienced a more volatile ride. This is likely due to the fact that RUT is made up of smaller companies, which tend to be less volatile than their larger counterparts in the NDX.

Another important factor to consider is the sector makeup of each index. RUT is heavily weighted towards the technology and healthcare sectors, which have performed exceptionally well over the past year. In contrast, NDX is more diversified across sectors, with a heavier weighting towards financials and consumer discretionary stocks. These sectors have underperformed in recent months, contributing to NDX’s underperformance versus RUT.

So what does this mean for investors? While it’s important to note that past performance is not always indicative of future results, the trends and patterns revealed on this chart do provide some insight into the potential strengths and weaknesses of each index. For example, investors who are bullish on technology and healthcare may find more value in RUT than in NDX. On the other hand, investors who are looking for diversification across sectors may prefer to invest in NDX.