Small Caps and Real Estate Hurt by Rate Hike Fears

Demand thesis

decreasing

Why underpricing possible

partially recognized

Evidence

• IWM PCR hits 2-year high
• 1 outlier, max severity 1.09
• Real estate stocks post losses in August

Risks

• A sudden drop in rates or strong economic data could reverse the trend.

Potential beneficiaries

Best currently accessible expressions

Portfolio action

WATCH — no company currently meets the trade threshold.

Invalidation

• IWM rallies above 200-day MA or 10-year yield drops below 3.5%.