Micro-Stock Doldrums

For a good part of my Wall Street career I have focused my research efforts on small and micro cap stocks.  It is therefore with much regret that I must admit that at this time there seems to be little interest in this sector of the stock market.   Investors just don’t seem to have much interest in the world of emerging small companies.  I follow many of these types of companies in my capacity as the director of research at Barrow Street Research and I can testify to the fact that while there are many terrific micro cap companies being traded their valuations are in the tank.  It’s very hard, particularly in this increasingly risk adverse investment environment for investors to get excited about small companies.  This is very unfortunate for the economy in general as these type of companies have for many years been the engine of job growth for the economy. What will it take to bring investors back into this sector?  I wish I had a good answer, but I don’t.  To some extent the disdain for small stocks is a result of many of the boiler room tactics that have been used in the past in promoting these types of stocks.  However, in today’s Internet world there is little reason for the savvy investor to be duped by unscrupulous touting of micro cap stocks. There is just too much information available on-line for any intelligent investor to be without the resources to check out micro cap stories.  For my part, I hope that investors begin to start looking for bargains among small stocks, for they most certainly exist.  I urge readers to start by looking at the Barrow Street Research web site.  I will be posting information on some smalls stocks that I find interesting in the days and weeks immediately ahead.

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