This is an exciting time to be looking at small-cap stocks. That is stocks that have a market capitalization of less than $2 billion. But first, let me give you three reasons why it might NOT be time for you to invest in small-cap stocks. First, if you’re going to need the money from your investments in the next 12-24 months, you need to be very careful with small-cap stocks. That’s because they tend to be more volatile than mid- or large-cap stocks. And during market corrections, small-cap stocks can drop much further than the broader market. Second, many small-cap companies are not profitable and may be years away from having a business model that will take time to catch on at scale. This means that these companies are at a higher risk of bankruptcy. And even if they don’t go out of business, many small-cap stocks never get beyond penny stock status. And third, because of their volatility, small-cap stocks can be a favorite of day traders and swing traders who are only concerned with short-term price movement. That, in turn, can contribute to the volatility in the stock. But if you have a longer time horizon and are committed to a buy-and-hold strategy, quality small-cap stocks have historically provided investors with an opportunity for high growth. In this special presentation, we’re looking at seven small-cap stocks. Some have an interesting story that is playing out right now. Others have a narrative that should provide a catalyst for the stock once the economy is back on a firm footing. Here are seven small-cap stocks we believe deserve a closer look.
(View the 7 Small-Cap Stocks that Present Long-Term Growth Opportunities)
Matthew Paulson
MarketBeat.com | 
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