Investing in small-cap stocks can be a smart move for investors looking to add potential growth opportunities to their portfolio. These stocks represent smaller companies with market capitalizations typically under $2 billion. While they may be considered riskier due to their size and relative unknown status, they also have the potential for significant returns.
Understanding Small-Cap Stocks
Small-cap stocks are shares of companies with small market capitalizations. Market capitalization refers to the total value of all outstanding shares of a company’s stock. Small-cap companies are typically newer, emerging companies that have yet to establish themselves fully in the market.
