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NBA Has Gone Small: Should Your Portfolio?

Aaron Katsman profile picture
Aaron Katsman


  • When I mention investing in small-cap stocks, many clients suddenly have a worried look that crosses their face.
  • Maybe it's time to follow the NBA and go small.
  • Again, small-cap stocks should be considered for long-term portfolios only, because it's a roller coaster with them, but remember that over the long term, they have produced very nice returns.

As originally appeared in The Jerusalem Post on February 25, 2021.

Whenever I have problems sleeping at night, I inevitably end up watching sports. Since it's basketball season, I have watched my fair share of games recently, in the wee hours of the night.

Ever since the Seattle Supersonics were stolen from the city and moved to Oklahoma City, my interest in the sport has waned some, but recently I actually just don't really enjoy watching the games, as the way the game is played has changed dramatically.

The NBA has embraced 'small ball', which means relying on smaller, more athletic players, who basically get the ball and shoot 3-pointers. It seems like the game has lost much of its strategic element, instead focusing on pure athleticism. Great athletes can produce one-off spectacular plays, but that comes at the expense of fundamentals, and the game in my humble opinion has suffered.

When I watch games with my kids, the biggest "oohs" and "aahs" come when someone's ankles are 'broken'. For the uninitiated, that means when a player on offense performs a dribbling move with the ball, usually a crossover, that causes the defender to either lose balance or fall to the court.

Often this happens but the player misses his shot. The kids are going on about how foolish the player who lost his balance looks while I point out that the point is to get the ball in the basket. It may have been an incredible move, but who cares, he missed the shot. Classic example of style over substance.

While basketball has gone small, the investing world has gone in the opposite direction. Little attention has been paid to small-cap stocks as much of the market's focus has been on large companies, like Microsoft (MSFT), Apple (

This article was written by

Aaron Katsman profile picture
Aaron Katsman, President and CEO (aaron@lighthousecapital.co.il). Aaron develops investment portfolios for clients around the world. He is author of the book Retirement GPS: How to Navigate Your Way to A Secure Financial Future with Global Investing (McGraw-Hill). A well-respected wealth manager, he writes a popular investment column for the Jerusalem Post. Previously, he was a founder and managed the private banking group for Citigroup in Israel. Prior to Citigroup, he was a senior analyst at a leading Israeli venture capital fund, where he gained an intimate working knowledge of the Israeli hi-tech scene, and was frequently invited to lecture on the Israeli economy. Aaron has been a contributor for AOL’s Bloggingstocks and has been a guest on CNBC’s Squawk Box.Aaron holds a B.A. in Political Science from Yeshiva University in New York. He is licensed by the Israel Securities Authority and holds the following registrations with FINRA and the SEC in the United States: General Securities Representative Examination (Series 7); Uniform Securities Agent State Law Examination (Series 63); Uniform Investment Adviser Law Examination (Series 65).Securities offered through Portfolio Resources Group, Inc. The opinion's are of the author and not necessarily that of Portfolio Resources Group, Inc. or its affiliates.

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