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Small-cap stocks quietly rise to new all-time high

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Traders work on the floor of the New York Stock Exchange on November 18, 2016.

Brendan McDermid | Reuters

Traders work on the floor of the New York Stock Exchange on November 18, 2016.

The Russell 2000 index hit an all-time intraday high on Wednesday, sneaking past its large-cap counterparts amid lingering trade tensions between the U.S. and some of its key trade partners.

Wednesday’s record marks the Russell’s first since Jan. 24, about a week before equities fell into a 10 percent correction. The Dow Jones industrial average and S&P 500 have not made records since Jan. 26, while the Nasdaq composite hit its most recent all-time high on March 13.

The small-cap index has also outperformed the Dow, S&P 500 and Nasdaq over the past three months, rising more than 4.5 percent. The Dow and S&P 500 are down in that time period, while the Nasdaq has gained about 2 percent.

Large-cap stocks have failed to capture record highs recently as trade tensions between the U.S. and China remain. Both countries have unveiled tariffs targeting one another. While those tensions show signs of thawing, Commerce Secretary Wilbur Ross said Monday the gap between the U.S. and China “remains wide.”

The tariffs and retaliation from countries such as China put at risk large-cap companies that do a lot of business overseas. Small-cap companies, meanwhile, are less exposed to a trade war, given most of their business is domestic.

Companies in the Russell 2000 derive 21 percent of their revenue from overseas, on average, while the large-cap S&P 500 obtains 30 percent from outside the U.S., data from Bank of America Merrill Lynch shows.

“There’s no risk of trade wars around the revenues of these companies. I like that,” Kevin O’Leary, chairman of O’Shares ETF Investments, told CNBC’s “Halftime Report” on Wednesday about small-cap stocks.

He also noted investors are underestimating the boost small-caps will get from a lower corporate tax rate moving forward. “We’re going to see some big upside surprises in the next 24 months on these companies.”



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Three options strategies for the week: August 20

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The “Options Action” traders share three options trading strategies to kick off the week.

Dan Nathan recommends a call spread in Alibaba.

Mike Khouw recommends a put spread in the Energy ETF

Mike Khouw recommends an iron condor strategy in the Russell 2000 ETF

Trader disclosure: On July 17, 2018, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s “Options Action” were owned by the “Options Action” traders: Dan Nathan is long XLF Sept put spread. Dan is long CAT put spread. Dan is long QQQ Sept put spread. Dan is long SMH Oct put spread. Carter disclosures not available. Long S&P, HAL. Bearish on TSLA.



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cornhole wants to make it to the big leagues

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Ankit Mittal, of Ellicott City, Md., tosses a bean bag as his friend Shean Flynn, of Newport News, Va., waves his Terrible Towel as the two were playing Corn Hole while enjoying tailgating before the game between the Pittsburgh Steelers and Washington Redskins at FedEx Field in Landover, Md.

Ricky Carioti | The Washington Post | Getty Images

Ankit Mittal, of Ellicott City, Md., tosses a bean bag as his friend Shean Flynn, of Newport News, Va., waves his Terrible Towel as the two were playing Corn Hole while enjoying tailgating before the game between the Pittsburgh Steelers and Washington Redskins at FedEx Field in Landover, Md.

Every day after he leaves his job as a warehouse general manager, Cody Henderson runs up to three miles. Then, he sets up cornhole boards and practices throwing beanbags for a couple hours, focusing on timing, balance and precision.

“It helps a lot with the endurance and mental game,” Henderson, 27, told CNBC. “If you can sit there and not get bored in a quiet area for two or three hours, you are really going to set yourself up to succeed on the pro level.”

Succeed he has. Henderson, who lives in Jackson, Ohio, is the top-ranked player out of the 20,000 pros in the American Cornhole League (ACL). He says he earned between $20,000 and $25,000 in prize money last year. He’s peaking just as the sport is surging in popularity.

While cornhole is generally thought of as a beanbag tossing game played at family gatherings or tailgate parties, it’s gotten so big that players like Henderson are making their way to ESPN. During last year’s The Ocho, a one-day event for alternative sports on ESPN 2, the Championship of Bags was the most viewed competition.

In the 18 to 49 age group, more peopled watched cornhole on that day than the competing game coverage of Major League Baseball, the WNBA or the final stage of the Tour de France, according to Sports Media Watch.

For Henderson, cornhole requires 20 hours a week of training and tournaments on weekends. Still, he said most people don’t take him seriously when he says he plays professionally.

“They’ll say, ‘Oh yeah really?’ and just change the subject,” he said. “When people were seeing me on ESPN, everyone’s attitude changed.”



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TiVo falls on report Amazon is developing live TV recording device

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TIVO, Inc. gave a way free TIVO (DVR) Digital Video Recorder, boxes to thousands of happy Comcast Cable customers, who also donated a toy or clothing for charity outside their corporate headquarters.

Kim Kulish | Corbis | Getty Images

TIVO, Inc. gave a way free TIVO (DVR) Digital Video Recorder, boxes to thousands of happy Comcast Cable customers, who also donated a toy or clothing for charity outside their corporate headquarters.

Shares of TiVo fell as much as 10 percent in afternoon trading Friday following a Bloomberg report that Amazon is eyeing a live TV recording device.

TiVo pared losses and closed just 4 percent down at $12.20. The drop extends a challenging run for TiVo, which is now off 20 percent in 2018 and 30 percent in the last 12 months.

Amazon is known to scare investors and send stocks tumbling with news of a planned entrance into a new industry. Earlier this week, movie theater stocks dropped on a report that Amazon is considering a bid for Landmark Theaters.

Representatives for Amazon and TiVo were not immediately available to comment.



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