Small-cap stocks could hit a rough patch when Vanguard readjusts its $4 billion Small Cap Index Fund in the coming months. Instead of the Russell 2000, mutual fund giant Vanguard will match its small-cap fund to Morgan Stanley's brand new MSCI U.S. Small-Cap 1750 Index (see MFMN 4/4/03).

"There's likely to be some price movement on the stocks. There's also likely to be some speculative activity around those names," said Amy Schioldager, managing director and head of U.S. equity portfolio management at Barclays Global Investor.

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