📉 Small-Cap Value Tilt

🧭 Background & Context A calm classification of the small-cap value tilt shows that it is a strategic overweighting of stocks of smaller companies with low valuation metrics. Historically, this factor has offered a risk premium, which, however, comes with higher volatility and periods of prolonged underperformance. The current market concentration on large-cap growth stocks has pushed the tilt into the background, which is cyclically typical. In the long term, the logic remains that these companies are often less noticed and can benefit disproportionately when the market turns. Implementation requires patience, as the tilt is not rewarded in every market environment. 📊 Market Environment & Drivers The main drivers currently are robust US consumer demand, which persists despite high interest rates, and the ongoing AI investment wave, which particularly supports the tec …