REMEMBER THE BIG ONES
Far too often the small investor rushes off to highest risk small-cap stocks hoping for a grand return in double-quick time and sure, the small stocks can pay handsomely, but they can also burn and the reality is that there’s a lot more burning going on. Ignored in this rush to quick wealth are the large-cap stocks, which can equally deliver splendid returns and are highly unlikely to dissolve into a pile of debt and bankruptcy. Year to date in the stocks with a market cap of over R10bn (large caps) there are 12 stocks that have returned over 50%, excluding dividends, this is monster wealth creation without the risks included in the smaller stocks. Simon says never ignore large cap stocks – after all this is how Warren Buffett got rich.