What Are Small Caps?

Under the Radar Report selects the best small cap stocks on the ASX for you to invest in.

99% of all financial news relates to the 40-50 biggest stocks. But what about the rest?

Under the Radar Report selects the best small cap stocks on the ASX for you to invest in. Small Caps are a key part of your ASX stock portfolio. They can provide some of the best dividend stocks but they are really known for their huge growth potential.

What are Small Caps?

Small Caps are the small companies listed on the ASX by size, or rather by it's market cap. The definition of what is a small cap can vary but it is generally a company with a market capitalisation of between $50 and $500 million.

There are over 2,000 companies listed on the ASX and most of them are small caps.

The ASX is one of the most concentrated markets in the world, with the top 10 companies (BHP, Telstra the banks) representing about 50% of the overall market!  

But there are huge investment opportunities in ASX small cap stocks but how do you know which ones to invest in?

ASX Small Caps 

Small Caps are exciting to invest in because it's the one area of the market that our subscribers, mum and dad investors, have an advantage over the big fund managers. The small caps on the ASX are just small for the big fund managers to invest in. Fund Managers won't even look at investing in a small cap until it reaches around $100m but really the majority of the funds won't consider investing until a small cap has grown to at least over $500m in market capitisation.

What does this mean?

It means that share price of these small caps has had to have doubled, tripled and quadrupled before a fund manager will invest in it and mum and dad investors have ridden the growth wave to get there.

You simply can't achieve the kinds of gains that you can get in ASX small caps that you can through other investments.

Our investment team filter through these companies to select a range of small caps that we believe can give around 100 small caps that we believe can give our mum and WE At Under the Radar Report we advise structuring your share portfolio clearly and that up to 25% of your portfolio should be invested across 7-10 small cap stocks to diversify your portfolio and position it for growth.

You simply can't achieve the kinds of gains in other investments that you can in ASX listed small cap shares.

Under the Radar's annualised return over our 100+  small cap shares is over 30 per cent.

Our annualised average return over all our 100+ small cap share tips is over 30 per cent and this includes some real duds, but it also includes stocks like Sirtex Medical or Select Harvests that have trippled in value.

At Under the Radar Report: Small Caps, we look for value, which means a company that is covering its costs, but has an option on greatness. These kinds of investments aren't found anywhere else.

Small Caps will give you the growth you need

To achieve 10.5% a year you need to hit the ball out of the park on one or two investments. This is what ASX listed Small Caps can do for you. We look for small caps with Growth that are currently priced cheaply.

A very personal example was from our editor’s family who put $70,000 into a small cap silver and gold miner - Bolnisi Gold –  with operations in Mexico. They invested at 9 cents and below between December 1996 and October 2003.
Less than four years later the small cap company merged with Coeur d’Alene Mines and is now the world’s largest listed primary silver producer. Its stock rose to $3.27 by June 2007, making their family $1.5m.

Small Caps can be at the risky end of the investment spectrum which is why you need strong underlying analysis of the company's. Small Caps really can grow a portfolio as seen here with Bolnisi Gold. And at Under the Radar Report, we provide you with institutional grade stock reseach, show you how to structure a portfolio plus give you frank interviews with the top performing small cap fund managers.

You need Small Cap information - and you'll find it here

Stocks like the banks, Telstra and some internet companies are trading at record high levels. Investors are confident that their earnings will appreciate, delivering growing dividend income. These companies have high “price risk”. If there is any softening of their earnings growth, their share prices are extremely vulnerable to big falls.

In contrast, what you see with Small Caps, is “information risk”. In these companies their historic earnings performance can often bear little resemblance to their future earnings. And so you need good research before you invest in them.

Under the Radar Report gives you the Small Cap information you need

The small caps Under the Radar Report covers and advocates buying are often not covered anywhere else. Fund managers are often not interested in small caps, because they are too small and it is hard for big funds to get a meaningful stake.

Under the Radar Report adopts a proprietary investment process in order to look for Small Caps that match our criteria. In addition to analysing company announcements and financials, we spend a great deal of time speaking to the management of the company.

Find out what the Top Performing Small Cap Fund Managers are investing in

We interview the top performing Small Cap Fund Managers to give our subscribers’ access to professional investors’ expertise – both on the market in general, and what ASX Small Cap Stocks they are  buying and selling.

If you want an edge in your portfolio, small caps will provide you with real growth. Subscribe to Under the Radar Report. It’s the best investment you’ll ever make.

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