Jonathan Satovsky delves into the performance of small-cap stocks compared to large-cap stocks, noting that historically, small companies generate a premium over larger ones. However, current underperformance is attributed to liquidity issues and the psychological impact of market volatility on investors. Jonathan emphasizes the importance of a long-term perspective and the ability to endure periods of underperformance to capture the historical premium of small-cap investments. He concludes by reflecting on the choice between investing in underdogs versus frontrunners, highlighting the need for alignment with individual investment philosophies and risk tolerance.
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