Video: The Positives of Investing in Technology Micro-caps
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The volatility of investing in mirco-caps may scare away some investors, but there are many opportunities to find hidden gems in the sector. As seen on CNBC's Talking Numbers, Barry Sine, Managing Director of Drexel Hamilton, gives an overview on the positives of micro-caps. The ability to pinpoint specific markets and segments can be especially rewarding when investing in new technologies, which are in favor this year.
Positives of microcaps:
- The financial statements are much simpler. Financial statements of microcaps are very straight forward, as opposed to having multiple sectors and a complex balance sheet .
- The management teams are very accessible. It is common to have direct communication with the management team and CEO of a micro-cap company.
- There is the ability to pinpoint a very specific market down to a country, or even a state.
- You can zero in on a specific technology or trend and capitalize on it. With trends and innovations like social media, display technology, and memory, there is potential for great rewards.
- If you do not want to invest in the companies that make these new technologies, you can invest in the companies that own the patents.