A recent CNBC article highlights the potential benefits of using a stock picking approach when investing in small caps. According to Rob Harvey, co-head of product specialists at Dimensional Fund Advisors, avoiding underperforming companies can boost returns. The Russell 2000, which tracks small caps, has seen a 12% increase this year, while the broader S&P 500 has risen around 23%. Harvey's actively managed fund, the Dimensional U.S. Small Cap ETF, targets profitable companies and has cash equivalents making up 1.13% of its portfolio.

Source: https://www.cnbc.com/2024/10/19/stock-picking-small-caps-may-boost-performance-right-now.html