Yogesh Supekar and Abhijeet Gosavi team up with Neerja Agarwal to bring this exhaustive report on the happenings in the world of small cap for our reader-investors.
Investors worldwide have always found investing in small cap space irresistible.The temptation of investing in micro cap and small cap is such that any seasoned investor having spent considerable amount of time in equity markets may have at least once in his or her investing career dabbled with a small cap stock thinking that it will some day become a mutlibagger.
Small cap stocks are not always the big fishes that everyone is aware of. But they are attractive from investors’ point of view for its ability to offer great returns in the long run and not comparable to any other asset class – period.
‘Greath growth potential,’ is the single most important aspect of small cap investing and investors often are clingy about such prospects of multiplying wealth faster. Indeed an astronomical amount of money can be made by investing in right small cap stocks. But an eternal question remains unanswered what is a right time and stage for a small cap stock to invest in and how to go about small cap investment because there are multiple anecdotes which suggest many individual investors have seen their capital getting completely wiped out for aggressive capital allocation in small cap stocks.
The table below highlights the various possibilities of investing into small caps depending upon which small cap stocks which you have included in your portfolio. Clearly there are some multibaggers’ performance reflected by small cap stocks and at the same time there are performances that have literally wiped out the entire capital in just one year's time.
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