Wilshire US Small-Cap Index

Definition

The Wilshire US Small-Cap Index is a market-capitalization-weighted index that measures the performance of small-cap stocks in the United States. It includes companies typically ranked below the top 750 largest companies by market capitalization.

5 Must Know Facts For Your Next Test

1. The Wilshire US Small-Cap Index focuses on small-cap stocks, which generally have higher growth potential but also higher risk.
2. It is a subset of the broader Wilshire 5000 Total Market Index, which includes all actively traded U.S. stocks.
3. Small-cap stocks in this index often represent emerging companies with significant upside potential.
4. Historical performance of small-cap stocks can be more volatile compared to large-cap stocks.
5. Investors use this index as a benchmark for evaluating the performance of small-cap funds and portfolios.

Review Questions

• What type of companies are included in the Wilshire US Small-Cap Index?
• How does the historical performance of small-cap stocks compare to large-cap stocks?
• Why might investors choose to use the Wilshire US Small-Cap Index as a benchmark?

Related terms

Wilshire 5000 Total Market Index: A market capitalization-weighted index that includes virtually all actively traded U.S. stocks.

Small-Cap Stocks: Stocks with a relatively small market capitalization, typically between $300 million and $2 billion.

Market Capitalization: The total value of a company's outstanding shares of stock, calculated by multiplying the share price by the number of outstanding shares.