Smaller Companies

I can see the Dow is breaking records but what's happening to smaller companies.
My US Smaller Companies fund is lagging every other fund I own.
What's going on ?

Sent from my Nexus 6P using USMessageBoard.com mobile app
Still the case.

There is this recent trend that I have observed that the smaller companies are getting bought up by big multinationals as a worldwide tide of acquisition frenzy. What king of cash powers this mess, would be interesting to figure. Operationally, it is true, that whilst in smaller companies 90 % of projects are real and 10 % are useless, in big multinationals 10 % are real and 90 % are useless. I wonder if shareholder value will reflect this, but I think not, because most small company buyouts are not publicly offered share buyouts.
 
I can see the Dow is breaking records but what's happening to smaller companies.
My US Smaller Companies fund is lagging every other fund I own.
What's going on ?

Sent from my Nexus 6P using USMessageBoard.com mobile app
Still the case.

There is this recent trend that I have observed that the smaller companies are getting bought up by big multinationals as a worldwide tide of acquisition frenzy. What king of cash powers this mess, would be interesting to figure. Operationally, it is true, that whilst in smaller companies 90 % of projects are real and 10 % are useless, in big multinationals 10 % are real and 90 % are useless. I wonder if shareholder value will reflect this, but I think not, because most small company buyouts are not publicly offered share buyouts.
Will the infrastructure bill make a difference ?
 
I can see the Dow is breaking records but what's happening to smaller companies.
My US Smaller Companies fund is lagging every other fund I own.
What's going on ?

Sent from my Nexus 6P using USMessageBoard.com mobile app
Still the case.

There is this recent trend that I have observed that the smaller companies are getting bought up by big multinationals as a worldwide tide of acquisition frenzy. What king of cash powers this mess, would be interesting to figure. Operationally, it is true, that whilst in smaller companies 90 % of projects are real and 10 % are useless, in big multinationals 10 % are real and 90 % are useless. I wonder if shareholder value will reflect this, but I think not, because most small company buyouts are not publicly offered share buyouts.
Will the infrastructure bill make a difference ?

I don't really know the answer to that, but unless there are special provisions in that bill, to treat contractors of various sizes differently, the insiders will scoop it all, and will end up like the Los Angeles San Francisco high speed railway in the making for the past 30 years by cost and no rail laid.
 
Smaller companies sometimes hold higher risk especially when higher leverage.
But stocks are many times not based on performance and value but popularity, volumes and other factors, which means some smaller company stocks are used as instruments of trade, easily manipulated especially by hedge funds, trading groups, short traders, market makers and etfs.
Ever notice a lows of the day showing an amount dollars lower then the actual low the chart reads? That manipulates the stock by lowering or removing scared people from bids , and in small priced stocks that is percentage wise more damaging especially in taking out people's stop orders.
The market maker, hedge funds, financial brokers make money from these manipulated spreads and undeserved tanking of stocks, but the avg investor and his funds like small cap ones, suffer.
 
Back in the 90s, east cost brokers were buying up small business as part of the tech boom. All the talent left once they realized brokers don't know how to run a bunch of small businesses as one. 90% of the dotcoms went bankrupt. When 90% of an industry fails it's called a scam. But it wasn't only the dotcoms, it was a bunch of old east coast money eating up everything. Time Warner wasn't a broker but buying AOL is a perfect example of what was wrong with the 90s.
 
Cheers.
Over here I generally invest in smaller companies as you often get better value. However Ive started to sell off my UK holdings ahead of Brexit.
Mainly buying into Europe and Asia but a bit nervous on missing out on the US as the the stock market is so huge.
 

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