A Smart Approach to Small Caps

By WallStreetDaily.com

To reiterate: our mission at Wall Street Daily is to provide sound, actionable intelligence on small-cap stocks, with a special emphasis on innovators across a wide range of sectors and industries.

I’ll also offer broader perspectives on markets, including assessments of what’s happening on Wall Street and other global financial centers, geopolitical commentary, macroeconomic issues, with some historical context, and reflections on the behavioral aspects of investing.

And I’ll highlight critical insights from our world-class team of strategists and analysts, including actionable ideas drawn from the Agora Financial suite of premium services.

I begin our coverage in earnest with tomorrow’s issue, as I start to build our case for small-cap stocks.

Small caps form an asset class considered “more risky” by most talking heads. But “right now” is the answer to the question, “When should I start buying small caps?”

Risk aversion is the name of the game. So we’re leaning in the other direction. But we’re doing it on a strategic basis – where we can exploit information advantages.

I’ll have more on why it makes sense to add small-cap exposure tomorrow morning.

After that, here’s what you can expect from me over the following six issues of Wall Street Daily.

Entering the World of Small Caps

We live in a world of constant uncertainty.

Our goal as investors is to reduce the variables. This is why “primary due diligence” is so important. Knowledge – not just “information” – reduces risk. I’ll explain in depth on Friday.

• On Monday, I’m going to get specific: What are we talking about when we talk about small caps? I’ll dissect the main small-cap benchmark, the Russell 2000 Index, sector by sector, describing the major movers, recent performance, and emerging opportunities.
• “The Factor” is the nickname I’ve given to the thing that separates Wall Street Daily’s coverage of small-cap stocks from the chaff. I’ll explain next Tuesday.
• By talking about regional and community banks, we’ll understand a big slice of the small-cap universe. And we’ll also understand the Big (Clumsy) Government aspects of Dodd-Frank, a cudgel where a scalpel is needed. That’s next Wednesday.
• Publicly traded real estate is essentially an asset class unto itself, a fact recognized by Standard & Poor’s with its decision to separate the group from the “financials” category. We’re going to focus on small-cap REITs next Thursday.
• I’ve developed a fascination with/fan-boy crush on Psibernetix Inc., a private company (for now) whose ALPHA artificial intelligence programmed to fly fighter jets has beaten several “top guns” in dogfight simulations. Check back in next Friday.

So that’s just the start of our small-cap coverage.

We’ll be addressing these and many other topics, including revolutionary biopharma and healthcare companies, small-cap metals and miners, and ways we can use options make any investment, in any asset class, manageable in a cash-in sense.

Each issue will close out with a short feature that aims to inform and entertain. The rotating “special subhead” will proceed as follows:

• On Mondays, Upticks, Downticks will comprise a list of data – five to seven points, looking back and looking ahead, with an emphasis on markets but an eye on the big world we live in.
• On Tuesdays, This Week In… will draw from the headlines for a lesson on one of the Seven Virtues – Faith, Hope, Charity, Prudence, Justice, Temperance, Fortitude – or one of the Seven Vices – Lust, Envy, Sloth, Pride, Avarice, Gluttony, and Anger.
• On Wednesdays, NBNBC (“No Balls, No Blue Chips”), my late uncle’s personalized license plate, will highlight a cool story about an early-stage company that’s doing the types of things that will one day result in it being mentioned among the big names in the stock market.
• On Thursdays, Money Quote will feature a contemporary or historical quote from someone prominent – or not – that sheds light on investing or, in the broadest sense, the well-lived life.
• On Fridays, Old Things New will take quick notice of an “old” book, movie, album, song, or something else from the past that’s worth a first, second, third, fourth, or fifth look over the coming weekend.
• And from time to time, we’ll try to Get Smart, drawing attention to something we’ve read that helps us make better decisions about our investments and/or life in general.

Thanks for reading Wall Street Daily.

Stay tuned for original, actionable ideas based on superior insights into exploding new industries… every morning, Monday through Friday.

Smart Investing,

David Dittman
Editorial Director, Wall Street Daily

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