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The Case for Small Caps

By Matthew Kerkhoff

 

During periods of major economic duress, escaping the financial markets entirely (or repositioning to profit from falling asset prices) can be wise. At other times, during less intense periods of duress, seeking exposure that has thermos-like insulation from outside forces may be the way to go.

 

If you haven't noticed, most of the concerns plaguing the global economy are not native to the US. We've got oil exporting nations hurting from lower oil prices, Greece causing concerns over a possible default or withdrawal from the European Union, China fighting to restructure their economy and abate slowing growth, and a host of countries experiencing disinflation/deflation and on the verge of recession. The US however, and the US consumer, seem to be doing fine (relatively speaking).

 

That being the case, where can investors find solace among all these sources of risk and volatility? Perhaps in small-cap domestic stocks. Even though small-caps, evidenced by ... Log in or subscribe to continue reading.


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