SUMMARY
- Small-cap stocks have struggled to outperform since Banz’s 1981 study on the size factor
- Micro-cap stocks behave similarly to small caps
- Structural shifts have made them less appealing, with lower valuations being their only advantage
INTRODUCTION
The world is filled with stories that seemed true but were later proven wrong, such as:
- Cats were witches’ spies (Medieval Europe): People in the Middle Ages believed that black cats were evil and associated with witches. This led to widespread cat killings – ironically, reducing the natural predators of rats, which contributed to the spread of the Black Death.