Specualtive investing in small caps is perhaps one of the most interesting phenomena of the stock market.

I will not deny, you can find speculative companies at each and every market cap, but if you are truly looking to maximize on the 8th wonder of the world which is compounding. One of the most fundamental rules if the rule of 72.

You may ask why ?

Here are a couple of reasons

1. ROI

One of the things that I stress about small caps is the possible return on investment. One of the things that drew me to small caps is the untapped potential and how little coverage some of the stocks get.

2.Business Model Diversity

For people who are not wall steet bankers and hedge fund managers one of the easiest ways to do this is to analyze businesses, look at what industry they are in, see what they set out to do. You can focus on the financial analysis after that. many times it is the case that the business modells have not reached fruition. Investors who find these opportunities are definitely playing with fire