The art of investing in micro-cap stocks lies in rigorous analysis paired with the nerve to take a contrarian approach, even when the broader market is united in its disdain.
Unlike large-cap stocks, which are widely traded and covered in the financial press, micro-caps will often fail to track their underlying companies’ intrinsic values, simply because there aren’t enough investors to make a market big enough for the stock to move in line with fundamentals.
This disconnect between stock price and a rational assessment of what a company brings to the table can stretch on for years, often making it blatantly clear that the broader market has no idea what it’s missing.
Two stocks worth thinking about under this lens are Spirit Blockchain and Sixty North Gold Mining, whose less-than-stellar returns fail to do justice to the growth embedded in their assets.
