Small Caps Crushed: IWM Sees $3.3B Outflow as Treasury Yields Surge - iShares Russell 2000 Index Fund (AR

Investors pulled $3.3 billion from the iShares Russell 2000 ETF (NYSE: IWM) last week as Treasury yields rose, intensifying pressure on small-cap companies more exposed to borrowing costs. The outflow, cited by The Kobeissi Letter on X, marked the fund’s second-largest weekly withdrawal of 2026 and its third-largest in nine years. Small caps have lagged large caps for five straight weeks, with the S&P 500 outperforming the Russell 2000, and another week could extend that streak to the longest in eight years. Since mid-August, the Russell 2000 has fallen 7.3% and hit its lowest level since June 10. IWM held about $77.6 billion in net assets as of Sep. 23 and tracks nearly 2,000 holdings. The 10-year Treasury yield climbed to 5.17% Thursday, its highest since July 2007.