By Meg Flippin, Benzinga
DETROIT, MICHIGAN - October 9, 2026 (NEWMEDIAWIRE) - With the Federal Reserve expected by many to continue its interest rate-raising campaign later this year in the face of stubborn inflation, and with bouts of volatility ever present, investors can’t be blamed if they’re moving out of tech and real estate. After all, both sectors are sensitive to interest rates and are, by many estimates, richly valued.
As a result, many are also looking toward small-capitalization stocks. They can often outperform when investors are looking for bargains and can offer the potential for growth since these companies are at the beginning of their business cycle. They also don’t usually get the same attention from Wall Street.
The Russell 2000 Index’s performance in 2026 points to that. Made up of 2,000 small-cap U.S. companies, year-to-date the index is up 13% as of Oct. 5, with the industrial, financial and energy industries accounting for most of the investor interest. Meanwhile, the S&P SmallCap 600 is up nearly 15% year-to-date as of the same date, with the same industries driving performance.
Performance data quoted represents past performance. Past performance does not guarantee future results. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Please call 800-617-0004 for performance data current to the most recent month end. Click here for SCAP performance.
Gain Small-Cap Exposure With The Infrastructure Capital Small Cap Income ETF
Small-cap stocks aren’t only a way to build a portfolio; they can also generate income, with some dividend small-cap stocks potentially paying yields that outshine large-cap stocks. This can offer investors a rare combination: regular dividend income and the potential for growth. That income can provide a buffer against market swings and provide cash flow to reinvest. But finding the ones that actually generate reliable cash flow and growth requires the careful eye of an experienced money manager, and that is where the Infrastructure Capital Small Cap Income ETF (NYSE: SCAP) comes in.
The Infrastructure Capital Small Cap Income ETF is an actively managed fund that aims to achieve an above-average yield by investing at least 80% of its net assets in an income-oriented portfolio of small-cap stocks. SCAP is run by Infrastructure Capital Founder, CEO and Portfolio Manager Jay D. Hatfield, who carries nearly thirty years of experience in the financial markets, offering a broad perspective on stocks, options and investing. Thanks to his extensive experience as an investment banker, portfolio manager and research director, investors get access to a seasoned money manager who has a proven record of creating a successful approach to investing and he is now applying the same acumen to small-cap, income-paying stocks.
The goal of SCAP is simple: Hatfield and his team target above-average yield through small-cap stocks and the use of convertible and preferred securities. Investors get access to a diverse basket of sectors and stocks, with a concentration in aerospace and defense, homebuilding, casinos and gaming, regional banks and mortgage REITs.
Selection Is Everything
When selecting the companies to include in the fund – which has an expense ratio of 2.20% while being actively managed – the manager uses his own internal price targets that are based on the link between earnings growth and price-to-earnings ratios. The team also employs selective option writing strategies and modest leverage to generate additional income while retaining potential upside market exposure. As of the end of June, the 30-day SEC yield was 4.08%, which means the portfolio generated an annualized net yield of 4.08% strictly from underlying dividends and interest earned over that period.
The ETF will also seek enhanced yield by writing index and single-stock options that reflect its own company price targets. Since this is an actively managed fund, Hatfield and his team go deep when selecting companies for the ETF. For instance, SCAP maintains relationships with issuer management teams to determine earnings estimates and forward-looking outlooks.
Ultimately, with SCAP, investors can get the opportunity to gain exposure to companies earlier in their growth cycle with potential for upside relative to market expectations, given there is less research coverage of them.
With interest rates possibly rising and volatility here to stay, tech may not be the only place investors can find growth. Small-cap stocks, particularly quality ones paying income, can be particularly attractive, and investors can seek those with the Infrastructure Capital Small Cap Income ETF (SCAP). To learn more about SCAP and to get started investing, click here.
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This content was originally published on Benzinga. Read further disclosures here.
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