Published on 22 Feb 2024 on Insider Monkey via Yahoo Finance

11 Best Small-Cap Growth Stocks to Invest In

In this piece, we will take a look at the 11 best small-cap growth stocks to invest in. If you want to skip our primer about the benefits and drawbacks of investing in small cap stocks, then you can take a look at the 5 Best Small-Cap Growth Stocks to Invest In.

The small cap sector of the stock market gets significantly lower coverage than compared to mega caps such as Apple and Microsoft. This is understandable since the latter category of stocks are of big companies that are global brand names. However, the sizeable nature of mega caps renders them weak when we consider the potential for returns. While there are some exceptions, higher share prices mean that not only is a stock less likely to make high double or triple digit percentage returns, but also since the stock is too expensive, there will be limited liquidity despite the fact that several shares are also sold in units.

On the flip side, small cap stocks, which are those with a market capitalization less than $2 billion, come with their own set of risks. These are smaller firms, with balance sheets unlikely to cross a billion dollars in total assets. Naturally, their size is due to the fact that when compared to firms such as the semiconductor firm AMD or the consumer defensive retail giant Walmart Inc. (NYSE:WMT), small cap stocks often have markets that are geographically limited.