The Fed went big this week and delivered a 50-basis point rate cut, with more easing on the horizon. Small caps tend to outperform the most during easing cycles, especially when the economy manages to avoid falling into a recession.

Wall Street watched small-cap stocks jump on Wednesday after the Federal Reserve decided to cut interest rates by 50 basis points. In response, the Russell 2000 (RTY) index of small-caps climbed 2.4% to 2,