SMALL CAP STOCKS: LIST OF STOCKS TO BUY + TIPS

Small cap stocks can grow fast and are cheaper than large cap. These lesser known stocks have the potential for huge returns. Then practice what you've learned with our free stock market simulation.

SMALL CAP STOCKS LIST

SymbolCompany
CHGGChegg Inc.
IRBTiRobot Corp.
ZUOZuora Inc.
AAXNAxon Enterprise Inc.
WTWWeight Watchers International Inc.
SFIXStitch Fix Inc.
ROKURoku Inc.

WHAT ARE SMALL CAP STOCKS?

Small cap stocks are not actually that small. Small cap refers to the market capitalization of a company. While the range can vary depending on who you ask, small cap refers to a company with a market capitalization between $200 million and $2.5 billion. But what does that mean? Market capitalization has two parts, share price and number of outstanding shares. Multiply those two numbers together and you get what is called market cap. Share price is simply the price that a given stock sells for on the marketplace. Outstanding shares on the other hand, refers how many shares the company has issued. Small cap businesses are established, but are dwarfed by tech giants like AAPL, which has market capitalization at over $700 billion.

 

HOW TO FIND SMALL CAP STOCKS TO BUY

Small cap stocks are everywhere. These companies aren't your big fish that everyone has heard of, but can offer great returns in their own right. One of the best attributes of small cap stocks is that they have great growth potential. You hear all the time about people who invested relatively small sums into tech companies like GOOGLE and made ridiculous amounts of money. Invest in the right small cap stock and that could be you.

The reason these smaller stocks are able to grow so fast is that they still have a relatively low market capitalization. Its just not possible for bigger companies to grow as fast because they would eventually become unsustainably large. On other hand, a smaller company can double its market cap many times over as they come into their own. Choosing the right stock is the key to investing in smaller stocks.

Small cap stocks are great because their is less competition from institutional investors. Their funds are so massive that buying a smaller company has little effect on their bottom line. That means a level playing field, and great value with lucrative rewards. Every giant was once a small fry. Who knows what the next Microsoft will be?

 

SMALL CAP MUTUAL FUNDS

While it is difficult for mutual funds to invest in small cap stocks, there are some who specialize in taking positions in smaller companies. These mutual funds are highly specialized and require tons of man power due to the number of businesses they invest in. Because small cap mutual funds can only invest so much in each company, they end up investing in hundreds of different small companies. This can be a lot to manage considering each business has their own growth and risk.

Fund management can really shine when it comes to picking small cap stocks. That's because any hidden gem can result in a enormous return as they balloon in size. Imagine buying shares in tech giants like Microsoft, Facebook and Google before they made it big. When a fund manager hits a home run, anyone who invested in that mutual fund stands to make some cash. Look for well managed funds because the return will outweigh the manager's cut of the profits.

Not all small cap stocks turn into giants, its actually quite rare. That's why small cap mutual funds diversify into hundreds of different companies. Even if they don't get lucky, a lot of small cap stocks still have great value.


BEST STOCK NEWSLETTER AWARD FOR 2020 STOCK PICKS (January 2, 2021 UPDATE)

The Motley Fool Stock Advisor wins our Award for the Best Stock Newsletter of 2020 with Average Stock Up 78%!

We have been tracking ALL of the Motley Fool stock picks since January 2016. That's over 5 years and over 120 stock picks. As of Friday, January 1, 2021, 21 of their 24 stocks picks from 2020 were up and the average return was 78% compared to the SP500's 19%. Take a look at some of their 2020 picks:

  • Lemonade (LMND) - Dec 3, 2020 pick is up 52%
  • Autodesk (ADSK) - October15 pick is up 21%
  • Fiverr Intl (FVRR) - Sept 3, 2020 pick is up 67% in just 4 months
  • CrowdStrike (CRWD) – June 4, 2020 pick is already up 120%
  • ServiceNow (NOW) – May 7, 2020 pick is up 44%
  • Zoom Video (ZM) – April 16, 2020 pick is up 124%
  • Shopify (SHOP) – April 2, 2020 pick and it is up 226%
  • Zoom Video (ZM) – March 19, 2020 pick re-recommended and it is already up 172%
  • DexCom (DXCM) picked Feb 20, 2020 right before the market crashed and it is still up 22%
  • NVTA picked February 6, 2020 is up 88%
  • Tesla (TSLA) picked January 2, 2020 before the crash and it is up 720% 

Now, no one can guarantee that their next picks will be as strong, but our 5 years of experience has been super profitable (their 2019 picks are now up 113% and their 2018 picks are now up 200%). They also claim that since inception, their average pick is up 570% and now we believe them. Many analysts are saying that the BULL market will continue into 2021 with the Biden Presidency, so make sure you have the best stocks!

Normally the Fool service is priced at $199 per year but they are currently offering it for just $99/year on THIS NEW SUBSCRIBER PAGE

CLICK HERE to get The Motley Fool's Stock Picks for just $99 per Year! 


THE BEST STOCK NEWSLETTER FOR 2020 AWARD goes to The Motley Fool Stock Advisor whose picks were up 78%!

That beat the SP500's +19% and 21 of their 24 picks were up and 5 more than doubled! Get their next 24 stock picks in real-time for only $99/year (50% off).
Their first pick of 2021 is already up 27%.



GET UP TO $1,000 IN FREE STOCK

WHEN YOU OPEN A ROBINHOOD BROKERAGE ACCOUNT

Robinhood was the first brokerage site to NOT charge commissions when they opened in 2013. They just past 10,000,000 accounts and to celebrate they are offering up to $1,000 in free stock when you open a new account.

Here's the details: You must click on a special promo link to open your new Robinhood account. Then when you fund your account with at least $10, you will receive one stock valued between $5 and $500. Then, you will get a link to share with your friends. Every time one of your friends opens an account, you will receive another free stock valued between $5 and $500. Click here to learn more about this Special Robinhood offer.

Claim your free stock NOW

(before it's too late)