Citi Research Sees Safety In Small Caps

The typical “flight to safety” investments have been strong performers since the Brexit vote caught the world off guard last week. The iShares Barclays 20+ Yr Treas.Bond (ETF) TLT 0.77% is up 5.5 percent, and the SPDR Gold Trust (ETF) GLD 0.41% is up 4.4 percent, while the SPDR S&P 500 ETF Trust SPY 1.7% has plummeted 4.2 percent.

Citi analyst Scott Chronert believes he has identified a post-Brexit safe haven stock play that is far from typical: small caps. According to Chronert, Citi is predicting a correlation to develop between the U.S. dollar and small cap stocks. Despite the Brexit fallout, the firm maintains its 1200 year-end price target for the Russell 2000.

“Considering the 2012 circumstance, we expect…

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