FLIPSIDE OF SMALL CAPS

➘ Risky: Smallcap companies are more prone to risks, especially during economic downturns

➘ Highly volatile:

Small-cap schemes tend to fall steeply during volatile markets

➘ Less researched: The very high number of small cap companies makes it difficult for analysts to research them

➘ Tactical investing:

Riding the small-cap run often needs tactical understanding of when to invest in them and when to exit

➘ No dividends: They often do not pay dividends, and can’t be relied on for income