What is the Advantage of Micro-Cap Stocks?
The smaller and more obscure a security, the more likely it is to be undervalued by the market. With this in mind, why would anyone attempt to beat the market by investing in giant large-cap companies that are already efficiently priced? The sad truth is that most investors do this every single day. They chase after lumbering giants like Wal-Mart (WMT), Cisco Systems (CSCO) and Intel (INTC), and as a direct result they usually earn lackluster returns. In my our personal investing we take an entirely different approach to the market — one that is not only well supported by a wealth of academic research, but that has also proven to be wildly successful over an extended period of time. Let us suggest you start by ignoring Wall Street, CNBC, and other mainstream sources of financial information. These widely available, traditional media outlets aren’t going to provide you with the edge you need to outperform the broader market. After all, the financial press devotes nearly all of its cove
