The S & P 500 notched its nineteenth new all-time excessive (for 2025) Thursday, the day earlier than the Fed’s most popular inflationary PCE Index simply matched expectations for July. This is the primary massive information take a look at for Fed coverage since Chairman Powell telegraphed a possible curiosity rate cut for the September assembly. I need to use the latest momentum in small caps to seize further dispersion amongst the U.S. main indices. I will likely be utilizing options on iShares Russell 2000 ETF (IWM) to take part in additional upside in curiosity rate chopping benefactors, small caps. The Russell 2000 Index, a benchmark for small-cap U.S. shares, has continued to outperform different main indices since final Friday, following Fed Chair Jerome Powell’s dovish remark. August has been significantly sturdy for small caps, that are up almost 10% to this point, making buyers suppose that this laggard index might lastly come again to life. For readability, small caps have been the worst performing U.S. fairness index for the final three years (per beneath YChart). With the Fed’s curiosity rate marketing campaign again on (after a almost one-year pause), small caps might have the flexibility to run tougher into 12 months finish. Small caps are actually extra unstable than bigger market capitalized names within the S & P 500, however excessive danger usually supplies alternative for top reward. The all-time excessive for IWM is $244.98 and this name unfold in need to personal is predicated upon a new all-time excessive being established this Fall. The Trade Bought the IWM $236 Call (9/30/25) for $5.85 Sold the IWM $250 Call (9/30/25) for $1.25 This name unfold is a debit unfold costing an investor $4.60 or $460 per one lot IWM was roughly buying and selling $236 when this unfold was established IWM must be over $240 by expiration for this unfold to breakeven DISCLOSURES: Long this name unfold All opinions expressed by the CNBC Pro contributors are solely their opinions and don’t mirror the opinions of CNBC, NBC UNIVERSAL, their father or mother firm or associates, and will have been beforehand disseminated by them on tv, radio, web or one other medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click right here for the complete disclaimer.