Seeking Alpha

Graph explains investor's infatuation with micro-caps

  • If small caps are "under-researched," then what does that say about micro-caps, writes Alpha Vulture. They're clearly even more "under-researched" and even less efficiently priced.
  • This, of course, is not new information, but the individual investor doesn't have to worry about a client pulling funds and the necessity of exiting a barely-traded stock at exactly the wrong time. Investing in micro-caps with a long-enough time horizon enables the individual to capture this liquidity discount.
  • Relevant ETFs: IWC, FDM, WMCR, PZI.
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