There???s a theory that small-cap funds outperform large-cap ones. One of the appeals for following this strategy in the U.S. market is an opportunity to beat institutional investors, such as mutual funds, which cannot invest in a small-capitalization company without making a public filing and disclosing the move to the rest of the investing world.
The lack of a long-term track record similar to the U.S. market prevents investors in Chinese equities from knowing if the same strategy can work there. Those willing to put the theory to the test can try the Guggenheim China Small Cap ETF (HAO).
Read more about HAO as a small-cap opportunity in China at Eagle Daily Investor.