iShares Russell 2000 ETF surges 41% in 12 months, eyes Fed moves and June reconstitution for next gains.

The iShares Russell 2000 ETF (IWM), tracking small-cap U.S. companies, has risen 41% over the past year, breaking a multi-year trading range. This rally is supported by a Fed pause on rate hikes and a rebound in GDP. Key upcoming factors include the Fed's decision on rate cuts by September and the annual Russell 2000 index reconstitution in June, which will reshape IWM's holdings, increasing financials and unprofitable firms. If the Fed cuts rates and the yield curve steepens, IWM could outperform; if not, the fund may face challenges due to its new composition.