Investors endured a historic move in the U.S. stock market on Thursday, as the Russell 2000 rose about 3.5% while the S&P 500 fell nearly 1%. Was this just profit-taking in the Magnificent 7 or is the long-term trend of large caps coming to an end? I think the answer is probably a little of both. While the small-cap index has been lagging the large-cap-driven S&P 500 for years, I believe now is the time to own the iShares Russell 2000 ETF. Let me show you how to do it for almost nothing. IWM .SPX YTD mountain iShares Russell 2000 ETF (IWM) vs. S&P 500 year to date Small caps appear to be benefiting from Thursday’s cooler-than-expected June consumer inflation report via CPI, signaling the Fed could start its rate-cutting campaign in September now. Thursday was just the second day since 1979 when the Russell 2000 rose more than 3% while the S&P 500 fell. One day doesn’t start a trend, but this significant divergence is a sign that smaller caps with significant interest-rate sensitivity may have room to continue to run a bit. IWM 1M mountain iShares Russell 2000 ETF, 1 month Trade Sell IWM 8/30/2024 $213 sell for $5.40 Buy 8/30/2024 $215 buy for $5.65 This difference would cost the investor $0.25, or $25 per lot This trade was executed when IWM was trading at around $213 Selling a risk reversal like this gives traders the ability to establish a position at low to zero cost, but it does not come with the risk of owning the underlying asset. The opportunity to offset the cost of owning a bullish call comes from the premium earned when selling a put call. In a perfect world, that put premium would completely offset the cost of the call, which seeks to allow the investor to catch a move higher. If IWM doesn’t go higher, investors should be prepared (with cash) to own IWM for the long game. I’m comfortable owning small caps here because mean reversion will happen at some point. DISCLOSURE: (Buy IWM long and buy this risk reversion) All opinions expressed by CNBC Pro contributors are solely their own and do not reflect the opinions of CNBC, NBC UNIVERSAL, its parent company or its affiliates and may have been previously disseminated by them on television, radio, the internet or other media. THE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND IS NOT INTENDED TO BE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO PURCHASE ANY SECURITIES OR OTHER FINANCIAL ASSETS. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MAY NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISION, YOU SHOULD CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here to view full disclaimer.