Is the Small-Cap Surge a Trend or Temporary Rotation?

Is the Small-Cap Surge a Trend or Temporary Rotation?

Tue, August 18, 2026 at 9:56 PM GMT+3 2 min read

Consumers are struggling but it's still not really showing up in markets as tech eats up traditional consumer stocks. Meanwhile, small-caps are having their moment in the sun, but will it last? And are some of investors' new shiny ETF tax toys on the Treasury chopping block? This week's ETF Zoo episode covers all that and more, featuring ETF.com hosts Dave Nadig, President and Director of Research, and Sumit Roy, Senior ETF Analyst, as well as Brent Sullivan, Editor of Tax Alpha Insider and Todd Sohn, Chief ETF Strategist at Baird Strategas.

• Goldman goes shopping again. A $2.3B buy of NEOS puts Goldman Sachs in the top ten ETF issuers, riding the retiree income wave. The crew discusses the broader implications for the options income space as investors continue to flock to these income alternatives.

• Consumer stocks are disappearing. Staples and discretionary have shrunk to a sliver of index weight while tech quietly eats their spending share. Is it the beginning of the next evolution of the category?

• Small caps are finally having a moment. RSP and equal-weight are outperforming as the Mag 7 cool off. Is it a real trend or just a seven-month blip? Don't miss this discussion on if the performance is a temporary rotation driven by AI exhaustion and concentration avoidance or if this is maybe, finally, the time for small-cap stocks.

• Treasury's coming for tax-aggressive ETFs. 351 exchanges, box spreads, and dividend-avoidance structures are all in the crosshairs. Brent Sullivan shares an inside look at what could potentially be on the chopping block, and why.

This week's guests:

Learn more about Baird Strategas or follow Todd Sohn.

Learn more about Tax Alpha Insider or follow Brent Sullivan.

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