Microcap Stocks Should You Invest in These Stocks?
People make money in the stock markets based on the information they get from all available sources such as the newspaper, internet, TV and of course the company itself. These companies publish their annual reports and also release information to the analysts from time to time.
Based on that information investors act and either buy or sell a stock. But there is one set of stocks that is particularly not investor friendly when it comes to dissemination of information. These companies are called microcap stocks or low priced stocks and they in a very typical manner do not publish information. Most of these microcap companies do not even bother to file information with the Securities and Exchange Commission so it becomes very tough to find information about the management of these companies much less any information about the finances of the company.
They are called microcap as these companies have very low market capitalizations. These companies by virtue of their low market caps do not get listed in NYSE or the American Stock Exchange but they are listed in the Over The Counter market such as the Over The Counter Bulletin Board (OTCBB) or the so called "pink sheets". On these exchanges like the OTCBB there are no minimum listing standards and what that means is that companies can list their shares without any regulation.
Compare that to NYSE where the companies have to have a particular market capitalization as well as certain amount of revenues. When the companies list in NYSE they have to comply with GAAP principles and that in all means very stringent criteria for listing. So if you are investing in NYSE companies you are reasonably sure of the quality of the stock. Plus the benefit that there are a number of investing gurus who track the stocks on NYSE and that means more information about the company and more view points form investors also.
Microcap companies have no track record so you will have to take that extra risk while investing in them. If you want to invest in microcap stocks you will have take time to learn more about the company. You need o research well if you want to invest in the microcap stocks. There is huge amount of risk involved and you can end up losing money on the stocks very easily.
So invest wisely and after careful consideration to all types of stocks and also diversify which means never put all your eggs in one basket.
Related Tags: stock markets
The author gives information on stock market for beginners and has put together a resource for people searching for online stock market for beginners guide.
Your Article Search Directory : Find in ArticlesRecent articles in this category:
- The Secrets to Getting Low Down Payment Car Insurance
Upon purchase of a new car, there is almost always a requirement to buy an auto insurance policy as - The Wisdom Behind Auto Insurance Comparison Quotes
No one in his right mind would not go for a good deal. In fact, everyone is out on their feet and ru - The Benefits of Auto Insurance Comparisons Florida
Insurance can be expensive. This is something everyone knows about especially in the sunny state of - Auto Insurance Florida: The No-Fault Policy
There are different kinds of car insurance offered by a wide range of providers today. Different sta - Finding the Cheapest Auto Insurance Companies
Everyone is asking and searching for the cheapest auto insurance companies available today. Consider - How do You Compare Private Health Insurance Cover in Australia?
Deciding what is the best and most affordable private health insurance cover can be easy if you take - How Payment Protection Insurance Was Mis-Sold
For over six years the issue of Payment Protection Insurance (PPI) and how it was mis-sold to custom - Finding Quotes For Auto Insurance Online
One of the many concerns when you are shopping for auto insurance is being able to get access to quo - How You Can Find the Best Auto Insurance Online
When it comes to renewing your car insurance you are going to quickly discover that there are a numb - Guidelines For Searching For Auto Insurance Online
The internet can be a great source of discounts and values related to auto insurance. However, many
Most viewed articles in this category:
- Trading Forex With Pivot Points
Forex Pivot Point Trading are used today by Forex Traders and are calculated on the previous days mo - Where To Search For Free Grants
Where do you look for free grants? The search must be thorough or it could be an exercise in futilit - The Connection Between High Blood Pressure and Salt
We are a society of Salt Addicts. It cannot be denied. When you look at the things we do and the pla - Tips For Avoiding HYIP Scams
Before knowing about HYIP Scams, refer to the functioning of HYIP or "High Yield Investment Programs - Getting Credit After Bankruptcy
Consumers do not have to live sans credit following a bankruptcy. By following certain steps consume - Tips For Choosing A Credit Card
Are you looking for that perfect credit card? If so, you may be confused about what exactly to look - Cheap Car Insurance For Teens Online
Many elements determine a car insurance policy. Car insurance companies look at the person's age, hi - What Exactly Is Free Grant Money?
You can apply for free grant money from various government agencies. But where exactly does this mon - Small Business Owners Marketing and Customer Service
Marketing can be time-consuming, but it doesn't have to be hugely expensive now, thanks to the Inter - Apply Online For A Credit Card - How To Choose A Card?
The best type of credit card for you will be dependant on how you intend to use the credit card. Are