In March this year Jim O’Shaughnessy (author of What Works on Wall Street) published an interesting research paper called A True Microcap Strategy.
The paper made a really convincing argument for investing in microcap companies including returns of 64900% over 45 years (for exact returns continue reading).
What is a microcap company?
In the paper Jim defined a microcap companies as companies with a market value of between $50m and $200m.
As a private investor microcaps are one of the few market areas where you have an advantage over fund managers and other large investors, because these companies are simply too small for them to be able to invest a meaningful amount of money in.
They are also never mentioned in the media which also keeps then under the radar of most investors.
For example, when was the last time you heard anybody on television or a popular website speak or write about a company with a market value of less than $200 million.
It simply doesn’t happen.
How to select market beating microcap companies?
How do you select high return market beating microcap companies you may be thinking? (Click here to continue reading)
Your microcap investment strategy analyst
Tim du Toit
PS To use this microcap strategy in your portfolio right now sign up here