Why did the RUT tank so hard?

[blackchip]

Any theories (or facts) on why the RUT got hit so bad compared to the Dow, Naz, S&P, etc.?

 

[HedgefundTrader2]

Quote from blackchip:

Any theories (or facts) on why the RUT got hit so bad compared to the Dow, Naz, S&P, etc.?

RUT is more volatile than SPX.

 

[nazzdack]

In a bull market, you expect smaller-cap stocks to rally farther. In a bear market, you expect them to decline farther. The "generals" are less volatile than the "cats & dogs".

 

[gov]

Trade it a bit and you'll see it often tends to overshoot the others. It's just its character. You'll begin to like that after awhile...

Me, I am waiting on today's gap up open; remember Mr. Market, I said gap Up open...

 

[blackchip]

Ok, I thought maybe it had to do with the debt market making it harder for small companies to borrow.

 

[jj90]

You could have noticed something in the recent weeks leading up to last on the RUT. When the 3 other majors were pushing up hard, RUT stalled consistently at 855.

 

[Babak]

Since it is small caps, they are a more representative index for US stocks. The SPX has a lot of international exposure. So if you want to short the US stock market, you'd go more with RUT than SPX.