Small Cap Stocks

What’s latest with these ASX small cap fintech stocks

 What’s latest with these ASX small cap fintech stocks

Complii Fintech, Change Financial, Beforepay Group, and FinTech Chain are some of the ASX-listed small cap stocks from the fintech space.

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From TEM to SMS: How have these ASX small-cap resources shares fared YTD?

From TEM to SMS: How have these ASX small-cap resources shares fared YTD?

  • June 26, 2022 07:00 AM AEST | Ashish

The benchmark ASX 200 index has remained under pressure so far this year, down nearly 14% since the start of 2022 due to geopolitical tensions, rising inflation and interest rates

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ART, PLY, SKO: How have these ASX small cap shares performed YTD?

ART, PLY, SKO: How have these ASX small cap shares performed YTD?

  • March 18, 2022 09:51 AM AEDT | Ashish

ks. Small cap stocks represent the firms with low market capitalisation (m-cap) but high growth potential. These stocks are popular among investors for their growth opportunities. Even as different stock exchanges have different rules to diff...

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ASX small-cap stocks with over 100% return in last one month - CRR, AUQ, ESS

ASX small-cap stocks with over 100% return in last one month - CRR, AUQ, ESS

The Australian economy is advancing on the road to recovery, with upbeat momentum typically represented by the Reserve Bank of Australia’s decision to stop buying government bonds from 10 February 2022. While Australia’s central bank ha...

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Why are these 6 small-cap stocks worth watching in 2022? 

Why are these 6 small-cap stocks worth watching in 2022? 

Highlights Investing in small-cap companies can be highly rewarding for investors; however, it comes with substantial investment risks. Several factors including company and industry performance must be taken into account for selecting small ca...

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Five ASX-listed small caps with over 100% returns in 2021

Five ASX-listed small caps with over 100% returns in 2021

  • December 22, 2021 01:58 PM AEDT | Ashish

Highlights Small-cap stocks belong to companies with low market capitalisation. These stocks come with high-growth potential. Buyers should be careful of the volatile nature of small-cap stocks. Small-cap stocks belong to companies with l...

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5 small-cap stocks with high returns

5 small-cap stocks with high returns

Highlights  Small-cap companies have exposure to growth opportunities that could translate into high returns on the financial markets. Small caps are vulnerable to market downturns as they do not have resources similar to large-cap compani...

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Three ASX small-cap stocks with over 7% six-month returns

Three ASX small-cap stocks with over 7% six-month returns

  • November 23, 2021 09:41 AM AEDT | Ashish

Small-cap stocks are popular among investors as they have the potential to outperform mid- and large-cap stocks. Unlike large-caps, small-cap stocks always have a high potential to grow further, implying investors can expect better returns in the f...

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Two ASX-listed small-cap shares that have delivered decent YTD returns

Two ASX-listed small-cap shares that have delivered decent YTD returns

  • November 18, 2021 12:01 PM AEDT | Ashish

Investors are usually attracted to small-cap shares since they have a track record of outperforming the mid-cap and large-cap stocks. The companies with small market capitalisation have a higher potential to grow compared to large-cap firms. Howev...

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10 ASX Hydrogen stocks for the long-term

10 ASX Hydrogen stocks for the long-term

Many energy companies across the world are exploring opportunities to utilise hydrogen as a fuel to meet the burgeoning energy demand and the net-zero emission targets. As per the International Energy Agency (IEA), the world requires an investment ...

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Smallcap climate Stocks trading on ASX

Smallcap climate Stocks trading on ASX

Highlights  Apart from discussing COVID-19, countries worldwide are now focusing on clean energy and related infrastructure. The climate change topic has gained attention lately due to rising temperatures globally. Some companies from thi...

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Frequently Asked Questions

Investors tend to get attracted to small caps because of the ability of these small companies to deliver exponential growth in a relatively quick span of time. These companies are able to deliver high growth rate in earnings because of small base. However, these stocks also portray a heightened level of volatility, which makes them not a viable investment decision for beginners or for investors with low-risk appetite. The weightage of small caps in a portfolio should be curated based on individual investors’ investment goals, time horizon, capital adequacy and risk appetite. Stocks of these companies also witness low trading volume on exchanges as most of the astute and big investors tend to stick to big and well-established companies.

Investment in small caps is similar to investing in a new company. Many companies might not be able to make it to the big league and investors might face a long streak of losses. However, a few companies have the ability to turn out to be multi-baggers, which deliver a massive return, covering losses from other small caps by a wide margin. However, investors need to have a high-risk appetite, adequate capital to sustain losses and not to mention proficient knowledge, only then they might have a chance to make it big in penny stocks.

Analyzing a small-cap company is sometimes more difficult than doing the same for a large-cap company. The reason is the limited financial history of the company and often poor fundamentals, which make it difficult to estimate the future potential of the business. Fundamentals of a small cap can change very quickly and therefore, long-term projections are often more skeptical. Investors’ conviction and knowledge up to the industry level constitute a good part of investing in small caps. Also, investors should not get carried away by one-time windfall profits by the company as the sustainability of these profits is not proven and often is questionable.

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