The small-cap sectors to avoid (and where to invest)

2022-05-30

When volatility is up and risk appetites are down, small caps invariably take a hit. Investors will naturally gravitate towards more liquid areas of the market. But the sell-off has been about more than just risk-off sentiment. Fundamentals have changed. Consumer-facing stocks are feeling the pinch while rising rates are set to hurt long-duration names with a lot of debt on the books. You can still remain invested in the market, though, so long as you replace any sells with high conviction b...

When volatility is up and risk appetites are down, small caps invariably take a hit. Investors will naturally gravitate towards more liquid areas of the market.

But the sell-off has been about more than just risk-off sentiment. Fundamentals have changed. Consumer-facing stocks are feeling the pinch while rising rates are set to hurt long-duration names with a lot of debt on the books.

You can still remain invested in the market, though, so long as you replace any sells with high conviction buys.

"It's ok to be active, but don't forget to buy something on the other side," says Josh Clark from QVG Capital.

In this edition of Buy Hold Sell, Josh is joined by Gary Rollo from Montgomery Investment Management to offer up some tips that will help you "aim small, miss small."

They'll also discuss the tech growth names that have 35% upside.

Read or watch below.

Note: This episode of Buy Hold Sell was shot on Wednesday 25th May 2022. You can watch the video, read an edited transcript or listen to the podcast below. All data provided by Mathan Somasundaram (DeepData Analytics)

Comments (3)