Global X has listed the first exchange-traded fund (ETF) on the local share market to track the Russell 2000 Capped Index, with the new offering providing access to 2000 United States small-cap stocks.
The ETF, carrying the Australian Securities Exchange code RSSL, is spread across the financial, healthcare and industrial sectors, focusing on early-stage companies.
Global X senior investment strategist Billy Leung said the focus on small caps was a result of changes in the US political system and economy.
“Small-cap equities often outperform during economic recoveries and periods of financial easing,” Leung said.
“Combined with Trump’s pro-growth and pro-business stance, US small caps are positioned to benefit significantly and offer long-term growth opportunities.
“With projected gross domestic product growth of 2.1 per cent in 2025, the US is set to outpace other developed economies and is leading the charge globally.
“By indexing the Russell 2000, RSSL gives investors exposure they might be short in, offering a diversification premium across small-cap growth and mega-cap innovation.”
He added new analysis from Global X found that during the first Trump administration, the Russell 2000 outperformed the S&P 500.
In the first six months, the Russell 2000 outperformed the S&P 500 by two percentage points, achieving a return of 17 per cent compared to the S&P 500’s 15 per cent.
The fund, which is the 42nd product launched by the investment manager in Australia, follows the launch of its Global X S&P World ex Australia GARP ETF (ASX: GARP) and Global X Bank Credit ETF (ASX: BANK), and is part of an expanding suite of research-backed ETFs designed for Australian investors.