In his recent interview on Bloomberg, John Rogers explained why more than ever, the greatest opportunities are in small-caps. Here’s an excerpt from the interview:
Rogers: From the very beginning when we started Ariel 38 years ago we were heavily influenced by the place that I used to work William Blair. Mr Blair used to always talk about the fact that smaller companies should be able to grow faster than larger companies, and we still believe that today, they can be more nimble, they can be able to take advantages of market opportunities when you’re small and nimble.
But secondly, smaller companies are less well researched. They were less well researched 40 years ago and they’re still less well researched. They’re not as well followed, so you can find some inefficiencies in the small cap sector and even today the amount of research in the small cap sector as you suggest have gotten less and less and less.
People are just not following these sort of neglected companies the way they follow the large growth companies that have been so popular, that are the multi-trillion dollar companies.
So you can do your own homework, do thorough research, and find these undiscovered gems we think in that small cap sector today more than ever, and that’s why we continue to fish in that same fishing pond.
You can watch the entire interview here:
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