Trieck points out that the best year for small-caps in the past two decades was 1991, when they returned a staggering 44.6 percent. So small-caps do tend to bounce back. No one knows. For at least a year, the market's volatility has inspired fund managers and other investors to seek shelter in the liquidity and predictability of large-cap stocks. Liquidity means a company has a considerable number of widely held shares, and investors thus enjoy ease of getting in and out.
Predictability means a solid customer base, good brands and regular earnings.
But favored large-cap stocks have been bid into the stratosphere. The rubber band could snap back smartly. In the meantime, Trieck isn't deterred. He is still enthusiastic about the two dozen small-cap stocks in his portfolio. While the stock has fallen by one-quarter in the past three months, it's still ahead more than 100 percent this year.