Santa Rally Incoming? Russell 2000 Steals the Spotlight!

Here's the kicker: the Russell's post-election performance this year is tracking pretty close to its 2016 post-election rally, back when Trump won his first term.

Even compared to the S&P 500 (which is doing better than it did in 2016), the Russell 2000 seems to have some serious momentum behind it.

And don't forget the classic Santa Claus rally! Historically, risky assets tend to run hot as the year wraps up, with the rally often kicking off right after Thanksgiving.

Looking at 33 years of data, the S&P 500 has ended December in the green 76% of the time, averaging a 1.6% gain. The Russell 2000? Even better—positive 79% of the time with an average 3% gain.

Election years are an even bigger deal.Since 1991, the S&P 500 has finished up in six out of eight election years, averaging a 1.4% return. But the Russell 2000? A perfect 8/8, with a massive average gain of 4.7%!

As the Russell 2000 soars with its best monthly performance, it's the perfect time to explore some hidden gems in the small-cap space! Here are three high-potential stocks:

AppFolio focuses on property management software, offering super-efficient SaaS solutions that are a hit with small and mid-sized property managers. With the growing demand for digital tools in real estate, their platform is gaining traction.

BGM is a global pharmaceutical and chemical company, and its diversified investment strategy has helped it delve into several emerging markets. The company's strategic acquisitions and investments are expected to drive even more value for shareholders down the line. The recent dip in price could be a great opportunity to get in at a discount.

Innoviva is all about drug development, working with big pharma partners to deliver innovative therapies. Most of their revenue comes from royalties on inhaled medications, and they have solid partnerships with top-tier pharma companies. With a low P/E ratio and strong profitability, this one’s a hidden gem in the biotech space.

Could this year be more of the same? Let’s see if the Santa Rally delivers again! Always DYOR, and happy investing!