Chapter 7

Small Growth: Sweet Sounding Start-ups

In This Chapter

arrow Factoring small company stocks into your investment pie

arrow Tempering your enthusiasm for expansion

arrow Recognizing ETFs that tap into this asset class

arrow Choosing the best options for your portfolio

arrow Knowing how much to allocate

arrow Introducing micro caps

Once upon a time in the kingdom of Redmond, there was a young company called Microsoft. It was a very small company with very big ideas, and it grew and grew and grew. Its founder and its original investors became very, very rich and lived happily ever after.

Oh, you’ve heard that story? Then you understand the appeal of small growth companies. These are companies that typically have market capitalization (the market value of total outstanding stock) of about $300 million to $1 billion. They frequently boast a hot product or patent, often fall into the high tech arena, and always seem ...

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