I began my investment career as a portfolio manager in 1972 with Western Bancorporation in Los Angeles (name changed to First Interstate Bancorp, now part of Wells Fargo). After nine years in banking, I became a Vice-President Institutional Bond Sales as Merrill Lynch in San Francisco, with the major West Coast banks as clients. Later at L.F. Rothschild. I then returned to the 'buy' side in 1987 - not long before the crash as an institutional cash management portfolio manager with BAIMCO. In 1990, I joined Wentworth, Hauser, and Violich as cash manager and later as bond manager and co-head of Fixed Income, leaving in 2004 to start my own firm, TBD Capital LLC, which I operated for 10 years, as a registered investment advisor. In 2014, I terminated my RIA registration to focus on consulting and creating a new blog on wine, traderbillonwine.com, published bi-monthly, which will hopefully lead to a book. For the past ten years, over 1,600 posts, I have published my blog daily at traderbill.com, which I will continue doing when events have interest to me.
Private full time investor since 1994, graduated in medicine, with interests in art and philosophy coming from Italy and living in Hungary, dealer in old masters painting until 1996. Overcame 2 big market crashes in 2002 and 2008. The strategy is to divide the assets in 2 categories: the first one invested in long term holdings and and the second for short term investments and trading.
Glen Bradford MBA is a born again independently wealthy accredited private investor and prior hedge fund titan that enjoys the process of discovering where and why he's wrong as soon as possible. He contributes to Seeking Alpha primarily to read people's negative feedback so that he can avoid generating unnecessary losses.
The absolute best you can do is give someone an opportunity and incentive to take it.
Take upon yourself worth carrying and enjoy as your own.
"Uncertainty will certainly work for me." - Glen Bradford March 2009.
Founder of "The Contrarian", a premium research service, featuring the "Bet The Farm" Portfolio. Actively investing since 1995, I have soared like an eagle, and been unmercifully humbled by the markets. Achieved positive returns in 2008, and turned an account with $60,310 on 1/1/2009 into an account with $3,177,937 on 11/30/2009. My best years have been 1995-2003, 2008-2012, and 2016-????. My worst years were 2013-2015. I believe inflation is coming, and we are at an inflection point in the markets.
Twenty year career as an investment analyst, investor, portfolio manager, consultant, and writer. Founder of Koldus Contrarian Investments, Ltd, which was incorporated in the spring of 2009. Dyed in the wool contrarian investor, who has learned, the hard way, that a good contrarian is only contrarian 20% of the time, but being right at key inflection points is the key to meaningful wealth creation in the markets. I believe we are near a meaningful inflection point, perhaps the biggest one yet, for the third time in the past 15 years.
Historically, I have had huge wins and impressive losses based on a concentrated, contrarian strategy. Trying to keep the good while filtering out the bad.
Seeking to run an all weather portfolio with minimal volatility and index overlays to capture my strategic and tactical recommendations along with a concentrated best ideas portfolio, which is my bread and butter, but the volatility only makes it suitable for a small piece of an investor's overall portfolio. The following are a couple of my favorite investment quotes.
"Life and investing are long ballgames." Julian Robertson
"A diamond is a chunk of coal that is made good under pressure."
"Knowledge is limited. Imagination encircles the world." Albert Einstein
I’ve been on top of the world, and the world has been on top of me. I have learned to enjoy the perspective from each view, and use opportunities to persistently acquire knowledge, and enjoy the company of those around me, especially loved ones, family, and friends.
At heart, I am a market historian with an unrivaled passion for the capital markets. I have had a long history and specialization with concentrated positions and options trading. Made money in 2008 with a net long portfolio, deploying capital in some of the market's darkest hours into long positions including purchases of American Express, Atlas Energy, Crosstex, First Industrial Real Estate, General Growth Properties, Genworth, Macquarie Infrastructure, Ruth Chris Steakhouse, and Vornado near their lows. Shorting, hedging, and option strategies also helped me in 2007 and 2009, and these are skills that I have developed ever since I started trading heavily in 1996.I enjoy reading, accumulating knowledge, and putting this knowledge to work in the active capital markets, learning lessons along the way.To this day, I continue to learn, and some of these learning lessons have been excruciatingly difficult ones, especially over the past several years, as I made mistakes allocating capital, including a sizable portion of my own capital (I always invest alongside my clients), to commodity related stocks. While all commodity related stocks have struggled since April of 2011, coal companies, which attracted me due to their extremely cheap valuations, and out-of-favor status (I am a strong believer in behavioral finance alongside fundamentals and technicals) have been the worst investing mistake of my career. The focus on the commodity arena has been the biggest mistake of my investment career thus far, yet in its aftermath, I see tremendous opportunity, even larger in scope than the fortuitous 2008/2009 environment.The capital that I accumulated and the confidence gained in navigating the treacherous investment waters of 2008 gave me the confidence to launch my own investment firm in the spring of 2009, right before the ultimate lows in the stock market. At the time I was working as a senior analyst at one of the largest RIA's in the country, and I felt strongly that the market environment was the best time since 1974/1975 to start an investment firm.
Prior to starting my firm, I was a senior analyst for three different firms over approximately 10 years (Charles Schwab, Redwood, Oxford), moving up in responsibility and scope at each stop along my journey. Since I was a paperboy, I have always had an interest in the investment markets. I love researching and finding opportunities. I am a Chartered Financial Analyst, CFA, as well as a Chartered Alternative Investment Analyst, CAIA. After starting in the teaching program at Ball State University, I switched to a career in finance when I turned a small student loan into a substantial amount of capital. I graduated summa cum laude with a degree in finance from Ball State.
Full disclosure, I am not currently a registered investment advisor, though I did serve in this capacity from 2009-2014, while owning Koldus Contrarian Investments, Ltd. Additionally, I held various securities licenses from 2000-2014, without a single complaint filed, and I continue to hold industry designations. At the end of 2014, I voluntarily let my state registration expire, as I transitioned the business to a different structure. At the time, I was in the midst of a difficult two-year plus divorce (my ex-wife left for another relationship) and custody battle, which occupied a lot of my time. Prior to this, I had passed, and held, various securities exams and licenses, including the Series 7, Series 63, and Series 65 exams, in addition to others, alongside my CFA and CAIA designations. Unfortunately, I did not file the proper paperwork to withdraw my state registration, and I did not disclose a personal arrangement, and subsequent civil case, between myself and a former close personal friend and client, that was initiated in 2011. I was unaware that I was required to disclose these items, and my securities attorney, at the time, did not advise me to do so. Previously, I had managed a portfolio for this gentleman, and we had taken an investment of approximately $7 million in 2009, and grown it to over $25 million at the beginning of 2012. After a difficult year of performance, an employee of the firm I owned, and friend, resigned in early 2013, and took the aforementioned client to a competing firm. As a result of not filing the proper paperwork, I agreed to a settlement, with a potential $2500 fine in the future, depending on if I choose to reapply to be a non-exempt advisor.
Chris DeMuth Jr. is the founder of Rangeley Capital LLC. Rangeley is an investment firm that focuses on event driven, value-oriented investment opportunities. Rangeley Capital and his value investing forum, Sifting the World (StW), search the world for misplaced bets. Rangeley exploits them for its investors and then Mr. DeMuth writes about them on StW.
Blogger, Self-Made Analyst, Trader, Investor, Crowdfunder and Critical Thinker. Currently, I am looking for a job in the investment space. Job offers are always welcome.
The name "Dutch Trader" refers to The Golden Age. This was a period in Dutch history, roughly spanning the 17th century, in which Dutch trade, science, military and art were among the most acclaimed in the world.
Dutch ships hunted whales off Svalbard, traded spices in India and Indonesia (via the Dutch East India Company) and founded colonies in New Amsterdam (now New York), South Africa and the West Indies. In addition some Portuguese colonies were conquered, namely in Northeastern Brazil, Angola, Indonesia and Ceylon. This new nation flourished culturally and economically, creating what historian Simon Schama has called an "embarrassment of riches". Speculation in the tulip trade led to a first stock market crash in 1637, but the economic crisis was soon overcome.
In 1602 the Dutch East India Company was founded. It was the first-ever multinational corporation, financed by shares that established the first modern stock exchange. This company received a Dutch monopoly on Asian trade and would keep this for two centuries. It became the world's largest commercial enterprise of the 17th century. Spices were imported in bulk and brought huge profits, due to the efforts and risks involved and seemingly insatiable demand.
To finance the growing trade within the region, the Bank of Amsterdam was established in 1609, the precursor to, if not the first true central bank.
My background is Management, Economics and Law. This I studied at Fontys Business School in the Netherlands, with specialization in Banking and Insurance.
My passion is investing, writing, travelling, history, swimming, playing chess and enjoying my family.
I love to analyze companies and sectors and write about it. Main points of interests: China, Biotechnology, Consumer, Energy, Mining, Dividend, OTC Market, Food, Robotics and some other themes.
As an investor I have a bias towards value investing and the markets. All opinions are my own and do not represent the views of my employer.Valuation metrics play an important part of my investment strategies. My investment philosophy is Unloved, Underowned and Undervalued.
One of the best investment quotes is: The key to making money in stocks is not to get scared out of them from Peter Lynch.
Do you have any other business proposals or questions, just write an email to firstname.lastname@example.org
Dutch Trader, The Netherlands================
For the Securities Disclaimer & Disclosure, read:
I am a self-taught investor. I look for stocks offering growth at a reasonable price and stocks that are undervalued. I am a member of an investment club and provide the majority of the research to the club. I am very interested in other active investors critiquing my research. I believe this critique will make me a better investor for both my own interests as well as the club's.
I am currently working as buy-side analyst for $600M AUM firm. I prefer concentrated portfolios, and am comfortable waiting for the eventual opportunities that arise with great asymmetrical risk. I am a CFA Charterholder, and try to read as much as possible and simply wait for others to offer great investments.
I am an equity analyst and founding member of a triple digit million dollar fund.
Oh, and I think technicals are nonsense.
...and no, the picture isn't me but a notable politician, and yes Mr. Samaras has been replaced!
I am fully accountable for the recommendations I make.... On my Instablog I give a recap of ALL picks and their performance
Former buyside analyst now running my own fund for accredited investors. Pseudonymous to protect my IR access but if you send me your email address and show me your LinkedIn, I'll show you mine. I'm not like anyone you've ever met and am not doing this for the traditional reasons. I’m always up for a conversation with anyone interested in value investing or mental models.
Starting in late August or early September, I will run a Marketplace subscription service called “Outsourced Analyst” targeted at small-mid-sized funds, family offices, or HNWs who want the workflow of an analyst for a hundredth of the price. I will provide objective coverage of high-quality, underfollowed small-caps. Subscribers also have early access to writeups of some of my best ideas like those I've posted on LQDT, CRAI, FC, LGIH, BOOM, CSWI, and so on. Bonus material is thought pieces - I place a lot of emphasis on learning and getting better - so if/when I make mistakes, I'll write up postmortems with what I learned, and maybe they'll help you as well... Membership will be limited to the first 250 subscribers.
I'm required to disclose that I'm a registered investment advisor but nothing I say is investment advice - it's just my Monday-morning-quarterback opinion for your entertainment and amusement. Always do your own due diligence, consider your own financial position, and consult your preferred financial professional before making any investment decision.
Recent high-school graduate based in Singapore looking to break into the buy/sell-side.
Disclaimer: The author's reports contain factual statements and opinions. He derives factual statements from sources which he believes are accurate, but neither they nor the author represent that the facts presented are accurate or complete. Opinions are those of the the author and are subject to change without notice. His reports are for informational purposes only and do not offer securities or solicit the offer of securities of any company. Mr. Goh ("Lester") accepts no liability whatsoever for any direct or consequential loss or damage arising from any use of his reports or their content. Lester advises readers to conduct their own due diligence before investing in any companies covered by him. He does not know of each individual's investment objectives, risk appetite, and time horizon. His reports do not constitute as investment advice and are meant for general public consumption. Past performance is not indicative of future performance.
I'm a financial analyst specializing in the technology sector bringing with me years of experience as Sr. financial analyst in a Fortune 500 tech company and as an independent analyst covering private and public tech companies.
Although I'm located in Israel I have an extensive list of worldwide clients that include tech startups, investment funds (hedge funds, VCs etc.) and individual investors.
My previous projects include analysis and valuation of publicly traded and privately held companies as well as financial projections/forecasts, financial modeling and ad-hoc financial analysis for startups. I also provided ad-hoc investment research and special situation investment analysis (IPOs, mergers, spin-offs, etc).
I'm teaching finance courses in the top universities in Israel and I write for Seeking Alpha to share my analysis, research and thoughts with others who are passionate about finance and technology as I do.
I'm open for new opportunities in my the area of expertise.
Feel free to contact me though the contact details below.
Email: email@example.com | LinkedIn: https://il.linkedin.com/in/lronen | Skype: lior.ronen.finro
Steve Percoco founded Lark Research as an independent provider of investment research in 1991. He has been the publisher of the Income Builder newsletter since 2001. He is a generalist, but focuses on several key sectors, including housing (and the homebuilders), real estate, utilities (electric, water and gas), telecommunications, energy and technology. Lark Research also offers institutional research services, including company and sector reports and market commentary.
Steve is a member of the New York Society of Security Analysts. From 1994-2004, he chaired NYSSA’s Committee for Improved Corporate Reporting. From 1996-2002, he served on NYSSA’s Board of Directors. He received the Society’s Volunteer-of-the-Year award in 1995, 1996, 2001 and 2002.
Prior to founding Lark Research, Steve was Vice President in the High Yield Corporate Bond Research Department at Salomon Brothers (1987-1990) and investment officer at Bank of Boston (1983-1987).
From 1994 to 2010, Steve chaired the Springfield NJ Investor Education Group of the American Association of Individual Investors (AAII). He served as a member of the FASB’s User Advisory Council from 2004 to 2006.
Steve is a graduate of Bowdoin College and Harvard Business School.
Value investor focused on micro-caps.
I write for CompleteBankData and am also a
Passively looking for a job on the buyside.
Always looking for more opportunities and to grow my professional network. Feel free to message me anytime.
Disclaimer: Nick reminds investors to always due their own due diligence on any investment, and to consult their own financial adviser or representative when necessary. Any material provided is intended as general information only, and should not be considered or relied upon as a formal investment recommendation
I run the long-term dividend investing website: www.theconservativeincomeinvestor.com
I spend most of my time reading through annual reports looking for a small-cap stock to feature in my monthly edition of "The Conservative Investor Digest." That is where you can find my best work, and that is where I focus my research.
You can become a subscriber here: https://gumroad.com/l/HmqJx
Over 30 years of investing in individual stocks. Extensive business experience with small to mid-size companies, including as CEO. Many hundreds of blog posts on financial and economic matters since 2008. Focus on value with catalysts for upside price action. Background as a physician and pharmaceutical inventor and entrepreneur, however focus now is global and involves almost all economic categories.
I am an analyst and Level II Candidate in the CFA Program that has gained experience in the investment industry through positions as a proprietary trader and a portfolio management administrator. I began contributing to Seeking Alpha as a way to share my thoughts on the biopharmaceutical industry. I discussed ways to minimize risk in biopharmaceutical investing through conservative pipeline valuation and balance sheet analysis to identify companies presenting a compelling valuation to potential investors. I also touched on ways to apply knowledge of the markets to improve personal finance. My pieces included either stock-specific analysis or general biopharmaceutical investing discussion through my Biotech Weekly blog. My research appeared on the websites of CNBC, Seeking Alpha, Reuters, Google Finance, Morningstar, NASDAQ, and MarketWatch.
Note: Articles and comments are my own opinions, are not related to the opinions of my employer, and should not be considered investment advice. Make sure to do your own due diligence before making an investment decision. Thanks!
My investment work is strictly non-professional. I seek to maximize value by developing data-rich, bottom-up models that forecast future company performance based on prior history. I focus on companies in the energy sector that deliver value to investors through regular distributions.
Professionally, I'm an engineer with experience in statistical process analysis.
I have been researching and investing in stocks and options in my own accounts since 2006. I finished my MBA in 2007 and then worked as the Finance Manager at a start up for 7 years. I'm currently self-employed as an online marketing consultant, but investing is my true passion.
I've found that my skill lies in taking the time to read 10-K and 10-Q reports carefully and being able to then create realistic future projections. As a value investor I tend to look at cash flow as much as if not more than earnings and revenues.
My investment horizon is typically at least 5-10 years, and ideally I place my money into investments which I could see myself holding through retirement. That said, I do also enjoy allocating a small portion of my account to short term options plays.
In our free time, my wife and I love to travel the world. We've each been to over 45 countries and relish the opportunity to see how people live all around the world.
I look for opportunities to invest where the expected value is sufficiently greater than the cost to invest and look to invest the appropriate portion of the total funds available. To make a gambling analogy, a highly favorable investment would be one where you could invest $1 on a flip of a coin and receive $10 if it flipped heads and lose only $1 if it came up tails. However, you would not want to invest all of your funds because you would be broke if the coin turned up tails. Thus, the goal is to find investments where the edge is sufficiently large and then invest the appropriate portion of the funds. The Kelly formula provides a theoretical basis for the appropriate percentage of total funds to invest in a single opportunity.
However, in the real world, the precise odds are rarely known. Thus, I seek to develop the ability and obtain the knowledge to calculate the odds with a degree of accuracy, and conservatively enough, to be able to make intelligent invesments.
With regards to equities, which I have primarily invested in, I seek to understand the economics of the business so as to evaluate its potential for long term success or failure. I seek to use this understanding, along with an examination of its financial statements, to determine if the company is undervalued or overvalued. I may then decide to go long undervalued companies and I may decide to short overvalued companies. My preference is to find companies to purchase, rather than to short.
Individual Investor, concentrating on value investing. Good previous success in identifying companies with less than perfect management, which eventually get taken over. If not, have actively engaged the management, to make changes in the interest of ALL their shareholders.
Please note that I do not read comments posted here, nor respond to messages here. I don't have the time. If you want my attention, you must seek it directly at my blog.
Aswath Damodaran is the Kerschner Family Chair Professor of Finance at the Stern School of Business at New York University. He teaches the corporate finance and equity valuation courses in the MBA program. He received his MBA and Ph.D from the University of California at Los Angeles. His research interests lie in valuation, portfolio management and applied corporate finance.
He has written three books on equity valuation (Damodaran on Valuation, Investment Valuation, The Dark Side of Valuation) and two on corporate finance (Corporate Finance: Theory and Practice, Applied Corporate Finance: A User’s Manual). He has co-edited a book on investment management with Peter Bernstein (Investment Management) and has a book on investment philosophies (Investment Philosophies). His newest book on portfolio management is titled Investment Fables and was released in 2004. His latest book is on the relationship between risk and value, and takes a big picture view of how businesses should deal with risk, and was published in 2007.
He was a visiting lecturer at the University of California, Berkeley, from 1984 to 1986, where he received the Earl Cheit Outstanding Teaching Award in 1985. He has been at NYU since 1986, received the Stern School of Business Excellence in Teaching Award (awarded by the graduating class) in 1988, 1991, 1992, 1999, 2001, 2007, 2008 and 2009, and was the youngest winner of the University-wide Distinguished Teaching Award (in 1990). He was profiled in Business Week as one of the top twelve business school professors in the United States in 1994.
Editors' Note: Seeking Alpha monitors Dr. Damodaran blog and posts relevant articles on his behalf.
Having always been a learning machine, I speak five languages, have worked as a sales agent, project manager, translator, computer consultant, software engineer, built a house with my own hands, published books and essays on literature, philosophy and art, have written for magazines of various kinds in different countries.
After retiring early in 2004, little by little, I have become a fund manager for some friends and myself, following the principles of value investing laid out by Benjamin Graham, Phil Fisher, Charlie Munger and Warren Buffett. You can read about my thoughts on a suitable portfolio structure for early retirees here.
My articles should not be considered to be any kind of investment advice. What suits me well is not necessarily good for others, as successful investing is somewhat like a marriage: If only one is perfect, the marriage won’t work. So please do your own research and remember Benjamin Graham's advice: “The investor’s chief problem — and even his worst enemy — is likely to be himself.”
I sincerely hope that my readers will ignore the Performance calculations provided by Seeking Alpha (although only to Pro subscribers, I believe). For reasons unknown to me, some of my European stock picks seem to be tracked inaccurately by Seeking Alpha's system. Spin-offs are not included in total return calculations and many of my correction requests didn't receive any answer at all. Moreover, my time frame almost never is as short as only 1 year (the maximum included in Seeking Alpha's table) and personally I consider the 1 year performance of my stock picks to be close to meaningless.
"One of the best ways to do well in this business is to go to areas that have been unexploited by research capability and work them for all you can." -Julian Robertson Managing partner of the Schildpad & De Haas partnerships. Seeking Alpha PRO contributor since the library's inception in 2013. A special selection of investment ideas is available through the Exclusive Research service.
Mid Market M&A consultant specializing in technology and energy industries. Individual Investor for over 25 years. Growth oriented investments primarily in market leaders and technology leaders. Investment philosophy is long term buy and hold with average holding time of several years.
I have a keen sense of cutting through management and Investment banker commentary and seeing true value of companies. A lot of my views tend to be controversial for that reason but at the same time remarkably accurate.
To get a feel for my writing, readers can puruse a few of my recent against the grain calls:- with extremely high success rates.
This account will be used by Seeking Alpha to publish the daily report of SA PRO's Top Long And Short Ideas (details below) exclusively for SA PRO subscribers. Non-subscribers will be able to read the reports 24 hours after they are published.
Seeking Alpha PRO subscribers get an early look at the best long and short ideas on Seeking Alpha and the best small to mid-cap research on Seeking Alpha, before these articles are released to millions of readers. We publish about 15-20 Top Ideas per week and about 15 top small/mid-cap research articles a market day, and they frequently move stocks. PRO subscribers also get exclusive access to Top Ideas and top research articles 30 days after release, when they become closed to other readers.
Early access. PRO subscribers get our Top Ideas and top research 24 hours before other readers. Because Top Ideas frequently move stocks, this provides an edge to traders and an information advantage to portfolio managers in understanding why their stocks are moving.
Broad research platform. Seeking Alpha PRO articles are closed to regular readers after only 30 days. PRO subscribers can access them indefinitely, allowing you to research a broad range of stocks and find people with knowledge of them. Research mid-cap and small-cap stocks with little or no coverage anywhere else.
Maredin Capital Advisors (Maredin) is a boutique, independent, Registered Investment Advisor, based in Miami, Florida. It was founded in 2005 by Marcelo Zinn and is based on the Value Investing philosophy founded by Benjamin Graham and popularized by his most famous student Warren Buffett.
At Maredin we pride ourselves on delivering financial services/products which help people and firms attain their financial goals. This is done through consultation with our clients, independent research and analysis, and a clear focus on long-term results.
Maredin manages three funds and Separately Managed Accounts ("SMA"). Each fund is intended for a specific audience yet share the same manager and philosophy.
Chris Ciovacco is the founder and CEO of Ciovacco Capital Management (CCM), an independent money management firm serving individual investors nationwide. The thoroughly researched and backtested CCM Market Model answers these important questions: (1) How much should we allocate to risk assets?, (2) How much should we allocate to conservative assets?, (3) What are the most attractive risk assets?, and (4) What are the most attractive conservative assets?
Chris is an expert in identifying the best ETFs from a wide variety of asset classes, including stocks, bonds, commodities, and precious metals. The CCM Market Model compares over 130 different ETFs to identify the most attractive risk-reward opportunities.
Chris graduated summa cum laude from The Georgia Institute of Technology with a co-operative degree in Industrial and Systems Engineering. Prior to founding Ciovacco Capital Management in 1999, Mr. Ciovacco worked as a Financial Advisor for Morgan Stanley in Atlanta for five years earning a strong reputation for his independent research and high integrity. While at Georgia Tech, he gained valuable experience working as a co-op for IBM (1985-1990). During his time with Morgan Stanley, Chris received extensive training which included extended stays in NYC at the World Trade Center.
His areas of expertise include technical analysis and market model development. CCM’s popular weekly technical analysis videos on YouTube have been viewed over 700,000 times. Chris’ years of experience and research led to the creation of the thoroughly backtested CCM Market Model, which serves as the foundation for the management of separate accounts for individuals and businesses.
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I focus on the microcap space (market cap below $250 million) because it is one of the most inefficient and "alpha rich" areas of the global equity market, which provides the greatest opportunity to generate alpha through fundamental research.
I use a bottom up, investment decision making process. The ideal investment has an asymmetric risk/return profile with a limited downside (e.g. high net cash balance, strong cash flow) and significant upside (e.g. asset value extraction, overlooked business model transition).
Microcaps are particularly attractive to the following groups:
Activist investors. A small absolute investment (on a dollar basis) can be leveraged into a relatively large position (as a percentage of shares outstanding), which provides a greater ability to demand change.
Private equity firms. The persistent microcap discount can be “arbed away” via an LBO with the new owners accruing all of the gains for themselves. The small absolute size of many microcaps on an EV basis significantly expands the number of firms able to pursue this strategy.
This inefficiency exists for several reasons.
A lack of analyst coverage due to lower trading volume (less soft dollars from HF/MF), the global settlement that permanently severed the link between research/banking and the rise in electronic trading/decimalization. Moreover, none of these trends are likely to reverse for the foreseeable future (if ever).
A lack of institutional products given the natural capacity constraint for new/existing managers.
An inability to effectively implement a passive approach (e.g. ETFs, index funds) due to the lower liquidity and wider bid/ask spread. However, each of these obstacles can be overcome by using a combination of electronic trading tools (e.g. algos) and patience in building a positive size.
Inaccurate and persistent misconceptions about microcaps (e.g. they are riskier than larger cap stocks).
I currently trade for my personal account but would like to move into the investment management side of the industry.