Small-cap stocks are a great idea for investors looking to maximize growth by buying into younger companies that have yet to strike it big. Such investments may carry some extra risks and aren’t for every investor. But if you have the proper risk tolerance, these small-cap stocks could become big winners.
Small-cap stocks represent companies with a market capitalization below $2 billion. Younger companies are often small-cap stocks with room for rapid expansion and innovation. These companies tend to be more agile than bigger companies and can react quicker to changing market conditions than a company than a major conglomerate.
This post originally appeared at InvestorPlace.