How do small caps compare on a global scale?

It takes a disciplined investor to put capital into small-cap companies they may never have heard of. Alex Dryden, global market strategist at J.P. Morgan Asset Management, looks at how small-cap stocks compare on a global scale

The long held bias towards large and mega-cap companies is a well understood phenomena. But with mega-cap companies around the world beginning to look pricey, investors may now find attractive opportunities in smaller global sized companies that tend to exhibit higher earnings and cash-flow growth - in many ways the true drivers of long-term stock performance. Many investors will be quick to highlight the inherent volatility of small-cap stocks. One corollary is the substantial opportunities for active small-cap managers to outperform passive mangers. In fact, 62% of international compan...