Small-cap stocks have recorded their longest stretch of outperformance against large-cap peers in seven years.

The Russell 2000 Index, which hit a record high on Monday, has now beaten the S&P 500 for seven consecutive trading sessions. The last time small caps achieved a longer run was in January 2019, when equities were rebounding sharply after a selloff that had pushed the market close to bear-market territory.

In December 2018, the S&P 500 dropped 9.2%, while the Russell 2000 declined even more, falling 12%. The downturn was driven by a mix of rising interest rates, escalating US-China trade tensions, and growing concerns about an economic slowdown. When markets rebounded the following month, small caps led the recovery, with the Russell 2000 surging 11%, compared with a 7.9% gain in the S&P 500.