Private investor and SeekingAlpha contributor Richard Bloch makes a noteworthy observation when suggesting that “MDY + IJR > SPY”. Bloch’s thesis is that investing in the S&P 1500, but without the top 500 would have produced noticeably better returns.
In fact, Bloch’s analysis includes not only a 10-yr look-back on comparing a $5000 investment in both MDY and IJR vs a $10,000 investment in SPY, but the cumulative profits if each month one would have shorted the same notional dollar of SPY against the combined notional long positions in MDY and IJR (accounting for both long dividends paid and short dividends owed). Click on the image for the full commentary:
