The 6 reasons small caps can supercharge your investment returns

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The 6 reasons small caps can supercharge your investment returns

Posted by Snouty 1245 days ago, popular 1245 days ago (http://monevator.com)
Category: Stocks | Tags: investing small caps stocks

Investing in small caps versus large caps has advantages we just can’t afford to ignore in seeking an investing edge.

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sunnyspeaks 1245 days ago

Investing in large caps may not be a good option these days. It's better to invest in small caps - minimum risk.

Snouty 1245 days ago

There's also the 'January effect' for short-term traders to think about. According to a commentator on CNBC a few minutes ago, virtually all the historical outperformance of small caps versus large caps comes in January.

thekritz 1245 days ago

"It's better to invest in small caps - minimum risk. " What? Quite obviously, the opposite is true. Of course, without risk, there is no reward. At the same time, for every 1 small cap that strikes it rich, there are probably 9 that collapse. Mathematically, it may be easy for a small cap to double in size, but in practice, this would seem quite difficult as small caps are inherently working with fewer resources at their disposal.

stockmanmarc 1245 days ago

Yes this has some truth, but with higher risks. Usually small caps don't have the longterm track record that larger established companies do. Its best to analyze the individual company before taking any action at all.

paulronan 1245 days ago

In any event, invest in small caps with caution and ensure that you've done the proper research and know your stuff first. I usually steer clear of them...

ultrageek 1244 days ago

I've always been of a similar opinion, but advantage #1 is, IMHO, a disadvantage at times. If you are not a diligent investor, then you're unlikely to do the research yourself.

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