T. Rowe Price Small-Mid Cap ETF

TMSL

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Investors looking to diversify their U.S. growth portfolios away from artificial intelligence may want to check how concentrated that exposure has become, according to new research from T. Rowe Price.

AI headlines are getting spooky, but what about AI stocks? The hyperscalers and megacap tech firms make outsized contributions to market movement.

Most of the attention in the artificial intelligence (AI) trade goes to chipmakers and cloud giants. However, T.

Small-cap and mid-cap stocks are outrunning large caps in 2026, and one portfolio manager says the shift has room to run. Key Takeaways: Earnings estimates for small caps are rising after 10 quarters of declines.

Small-cap stocks remain the cheapest corner of the U.S. market. That's true even after posting their best first-half performance in more than three decades, according to Morningstar's Q3 2026 stock market outlook.

The ETF three-year milestone is more than just an opportunity for firms to tout their funds or celebrate years of work. That marker has material consequences for current and future investors in a fund, opening up those strategies to new flows.

Beyond the Mega Caps: Advisors Eye Small- and Mid-Cap Strategies The strong run by the Nasdaq-100 and the S&P 500 the last few years has loaded portfolios with heavy concentration risk. As a tiny group of mega cap tech giants shapes the market, finding meaningful diversification has become a priority for advisors.

Concentration risk has emerged as a dominant threat to portfolios this year. Even as geopolitical tensions show signs of cooling under a potential U.S.-Iran deal, market crowding remains a top concern.

Small-cap stocks are drawing renewed attention from T. Rowe Price as the firm's 2026 midyear outlook signals a broad shift in market leadership away from the largest technology companies.

Small-cap stocks are the most attractively valued capitalization segment of the U.S. equity market right now, trading at a 17% discount to fair value, according to Morningstar's Q2 2026 US Stock Market Outlook. Key Takeaways Small-cap stocks are trading at a 17% discount to fair value, the deepest of any market segment.