After lagging behind large-cap peers for the past two years, small-cap stocks may finally be poised for a breakout in the second half of 2025. With interest rate cuts potentially on the horizon, improving macroeconomic conditions, and attractive relative valuations, institutional investors are beginning to rotate into this overlooked segment of the market.
One of the most reliable telltales of opportunity in small caps is insider and institutional buying. When executives and directors put their capital to work, strong fundamentals and institutional buying back those trades can be a powerful signal for individual investors.
