With high gas prices are small cap stocks a good investment?

Question

With high gas prices are small cap stocks a good investment?

Answer 1

I don't see any correlation between high oil prices and small cap stocks.

Answer 2

Small-cap stocks are still a good investment, despite the tight economy, because of the numerous stocks for under $5. Common stocks can be bought or sold for specifically quoted prices if working through a broker and their liquidity makes them more attractive than long-term investments. The key is to pick the right investment by doing your own research – you just have to watch for solid fundamentals and a selling price near the 52-week low. If you’re new to the game or already an experienced investor, research sites like http://beaconequity.com/ are helpful and quick ways to get a heads up on small-cap companies. The site has analyst reports, daily articles and “TradeNotes” updated daily.

Answer 3

A small number of small cap stocks will be involved in producing fuel, in producing things that reduce our demand for fuel. Some of those could take off because of high fuel prices. But in general, small cap stocks are not particularly secure when prices for fuel go up.

Buying small caps on the basis of low dollar value per stock would qualify as a fools game.

I have made some big gains by investing in top of the line small cap mutual funds. But not to forget that they ding you heavily in fees.