- While Mining stocks helped kick-start the ASX 200 rally this year but faded midway, financial stocks have held their ground.
- Some penny stocks in the financial space have outperformed broader markets hands down.
- These stocks include ARC, MCX, PV: etc.
The financial space has been a major contributor to the ASX 200 this year, helping it to reach its all-time high of 7,632.8. While local miners had given share markets a head start at the beginning of the year, easing iron ore prices weighed down on miners, trashing their entire YTD return to negative.
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However, financial stocks kept going, leaving the mining sector in the dust. Let us have a look at some of the smallest companies in the financial space that have raked in high gains this year.
- Australian Rural Capital Limited (ASX:ARC)
Australian Rural Capital is an AU$16.97-million publicly owned investment manager. The company recorded an after-tax loss of AU$577,486 for FY21, primarily due to the reduced valuation of its investment in Namoi Cotton.
In March 2021, the company raised AU$388K to boost working capital and the cash position, via undertaking a 15% placement of new shares at AU$0.2. The ARC share price closed at AU$0.51 on Friday, delivering a massive return of 34.21% this year.
- InvestSMART Group Limited (ASX:INV)
InvestSMART Group is one of Australia’s leading platforms for do-it-yourself investing. On 13 September 2021, it introduced Australia’s first “Invest Now, Fund Later” investment service, Fundlater. It allows investors to invest AU$10,000 in a portfolio of ETFs with an initial deposit of AU$4,000, the rest could be paid through instalments.
InvestSMART is an AU$41.7-million company. As of 24 September 2021, its share price has delivered a year-to-date return of 275%, last closing at AU$0.3.
- Orion Equities Limited (ASX:OEQ)
Orion Equities is an Australian Listed Investment Company (LIC), having a market capitalisation of AU$4.3 million. In FY21, the company generated a revenue of AU$122.14K, up by a massive 86% from FY20 revenue of AU$65.61K.
However, profits skyrocketed to AU$5.28 million (768% jump) due to an AU$2.2-million net gain on financial assets and AU$2.81 million profit on shares of the associate entity. The OEQ share price closed at AU$0.28, delivering a year-to-date return of 111.54%.
- Powerhouse Ventures Limited (ASX:PVL)
Powerhouse Ventures’ share price has run up 83.33% this year so far, as of the last closing price of AU$0.11 on 24 September 2021. The company invests in intellectual properties and has a market capitalisation of AU$10.6 million.
During the quarter ended 30 June 2021, the company converted 27.64 million PVLO options to PVL shares raising AU$1.94 million and finished the quarter with unaudited cash reserve of NZ$4.81 million.
- Mariner Corporation Limited (ASX:MCX)
Mariner Corporation is an AU$2.64-million company that invests in listed and unlisted small-cap companies in Australia. In the June 2021 quarter, focus on identifying and exploring growth opportunities. It already has a busy pipeline of opportunities to progress in 2021 and has also focus on its cost-saving initiatives.
The board continues to monitor COVID-19 developments and assessing its operations. The MCX share price last closed the session at AU$0.055, with a market capitalisation of AU$2.64 million. The year-to-date return of MCX share stands at 83.33%.
As the financial space has continued to lift the broader market index, the ASX 200, a lot of small-cap ASX companies have massively delivered an outperformance, some even bolstering to triple digits. However, these returns are not easy to fetch and an investor must always approach the penny stocks space with utmost caution and after his/her own due diligence.
It is also recommended to consult a financial advisor before diving deep into the penny stock space.
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