US small-cap value returns have been severely dragged down by concentrated exposure to three underperforming sectors: (1) energy (which peaked in 2014-15 then collapsed and has been a 'wasteland' as shale fracking companies appear to be 'capital incineration machines'), (2) regional banks (which have not reached sufficient scale through M&A and faced a major crisis with First Republic), and (3) biotech (which is down ~60% from peaks and is 'annihilated'), making US small-cap value a poor equity exposure unlike international small-cap value which is more diversified.