RUSSELL 2000 (LONG & SHORT)
IWM and RWM are exchange-traded funds (ETFs) that offer investors the opportunity to invest in the Russell 2000 index, which is composed of small-cap U.S. equities.
The iShares Russell 2000 ETF (IWM) aims to track the investment results of an index composed of small-capitalization U.S. equities. This means that IWM holds the same stocks that make up the Russell 2000 index and is designed to provide investors with exposure to small public U.S. companies. IWM is a “long” ETF, which means it is designed to provide investors with long-term growth potential through the performance of the small-cap U.S. stock market.
Investors who are looking to diversify their U.S. stock allocation may consider investing in IWM. This ETF can be used to gain exposure to small-cap U.S. equities in a single fund and seek long-term growth in a portfolio. Small-cap stocks are often considered to have higher growth potential than large-cap stocks, but they also carry higher risk.
On the other hand, the ProShares Short Russell2000 ETF (RWM) aims to provide daily investment results, before fees and expenses, that correspond to the inverse (-1x) of the daily performance of the Russell 2000 index. This means that if the Russell 2000 index declines by 1%, RWM is designed to increase by 1%. RWM is a “short” ETF, which means it is designed to provide investors with amplified returns when the index it tracks decreases.
Investors who are bearish on the small-cap U.S. stock market may consider investing in RWM. This ETF can be used to hedge against potential losses in a small-cap stock portfolio or as a way to bet on the future performance of the small-cap U.S. stock market.
It’s important to note that RWM is designed to provide short-term exposure to the small-cap U.S. stock market and is not suitable for long-term investing. As with any investment, it’s important to do your research and understand the risks and potential rewards before investing in RWM.
In summary, IWM is an ETF that offers investors exposure to small-cap U.S. equities and the potential for long-term growth in a portfolio. RWM is a short ETF that aims to provide investors with amplified returns when the small-cap U.S. stock market declines. Investors should consider their investment objectives, risk tolerance, and investment horizon before investing in either IWM or RWM.