US small caps stand out

US smaller companies will continue to outperform over the medium term as markets deliver low to flat returns, according to Boniface Zaino and Jack Fockler of Legg Mason Inc subsidiary, Royce & Associates. Speaking at a recent London conference, Fockler said small caps outperformed in 80% of the 160 periods of lower and normal return periods, based on rolling 10-year figures since 1930. Higher return decades, of 17.5% annualised growth or above, favoured large caps, which outperformed in 76% of the 106 higher return periods over the same time frame, according to research carried out by...