Exchange-traded funds that provide exposure to US small-cap companies are among the largest in the world, and investors have been rewarded for their participation in this subset of the US equity market. Less well known, however, are Eurozone small-cap companies. The Eurozone developed country equity market is characterized by visible performance differentials among size segments. Small-cap companies have not only significantly outperformed large-cap firms in recent years but also in the longer term and on an absolute and risk-adjusted basis.

With the Eurozone’s economy starting to stabilize in 2012, and the expectation of continued growth, investors may want to look to Eurozone small caps to allocate capital. This paper provides an overview of the Eurozone small-cap market using the EURO STOXX Small Index. Our aim is to help investors understand Eurozone small-cap investment exposure in an effort to promote insightful investment decisions.

Read: EURO STOXX Small Index: a liquid gateway to high performing Eurozone small-cap stocks