Finance

Rally in small caps just starting: VettaFi’s Rosenbluth suggests

Published

6 months ago

November 30, 2024

Small caps just had their first historic week in three years, and one exchange-traded fund expert predicts the group’s record highs will help drive investors back into the group.

“Small caps are going to become more in favor in 2025,” VettaFi’s Todd Rosenbluth said on CNBC’s “ETF Edge” this week. “They started to perk up since the election and heading into the election as interest rates have been coming down.”

Rosenbluth, the firm’s head of research, expects ETF funds specializing in small caps to reap the benefits of investors looking to broaden out their market exposure.

The Russell 2000, which tracks small-cap stocks, hit its first record high since November 2021 this week and just saw its best monthly performance since last December. The index is up almost 11% in November and 35% over the past 52 weeks as of Friday’s close.

Rosenbluth suggests some profit taking in the “Magnificent Seven” stocks, which include Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms and Tesla, will benefit small caps. He also expects investors to rotate out of money market accounts due to the effects of the Federal Reserve’s interest rate easing policy.

“We expect some more dispersion in the winners,” Rosenbluth said.

Rosenbluth cited the iShares Core S&P Small-Cap ETF and the VictoryShares Small Cap Free Cash Flow ETF as potential ways to play strength in small caps. The Core S&P Small-Cap ETF is up 11% in November while the VictoryShares’ fund is up almost 8%.

Finance

UK’s FCA teams up with Nvidia to let banks experiment with AI

Published

2 hours ago

June 9, 2025

Business Finance News

Jakub Porzycki | Nurphoto | Getty Images

LONDON — Britain’s financial services watchdog on Monday announced a new tie-up with U.S. chipmaker Nvidia to let banks safely experiment with artificial intelligence.

The Financial Conduct Authority said it will launch a so-called Supercharged Sandbox that will “give firms access to better data, technical expertise and regulatory support to speed up innovation.”

Starting from October, financial services institutions in the U.K. will be allowed to experiment with AI using Nvidia’s accelerated computing and AI Enterprise Software products, the watchdog said in a press release.

The initiative is designed for firms in the “discovery and experiment phase” with AI, the FCA noted, adding that a separate live testing service exists for firms further along in AI development.

“This collaboration will help those that want to test AI ideas but who lack the capabilities to do so,” Jessica Rusu, the FCA’s chief data, intelligence and information officer, said in a statement. “We’ll help firms harness AI to benefit our markets and consumers, while supporting economic growth.”

The FCA’s new sandbox addresses a key issue for banks, which have faced challenges shipping advanced new AI tools to their customers amid concerns over risks around privacy and fraud.

Large language models from the likes of OpenAI and Google send data back to overseas facilities — and privacy regulators have raised the alarm over how this information is stored and processed. There have meanwhile been several instances of malicious actors using generative AI to scam people.

Nvidia is behind the graphics processing units, or GPUs, used to train and run powerful AI models. The company’s CEO, Jensen Huang, is expected to give a keynote talk at a tech conference in London on Monday morning.

Last year, HSBC’s generative AI lead, Edward Achtner, told a London tech conference he sees “a lot of success theater” in finance when it comes to artificial intelligence — hinting that some financial services firms are touting advances in AI without tangible product innovations to show for it.

He added that, while banks like HSBC have used AI for many years, new generative AI tools like OpenAI’s ChatGPT come with their own unique compliance risks.