Let's
Begin with a Research Update
In
the second week of March 2014, an update came out on a news website
that a stock
market research firm has released research on a
Canada-based OTC stock. The firm specializes in small-cap stocks, and
it aims to provide integrated communication services to investors
through a user-friendly interface. This is indeed an encouraging
trend, and will help users as they will find it easier to do
necessary research on specific stocks.
Why
Research is Important for Investors
This
is a crucial question, and one of the fundamental needs for a good
small- or micro-cap investment. Making hasty investments for
short-term gain can lead to losses. Ill-advised investments without
doing adequate research often turn out to be a financial disaster. In
addition to that, getting lured by micro-cap scams that make big
promises is one of the worst financial decisions that investors can
make.
Apart
from the fake stocks, sometimes even legitimate investments can burn
investors' money. This happens due to a lack of research that would
have exposed the weak links of some specific companies. The company
insiders who operate such stocks often take unethical tactics to
manipulate stock prices. This in turn, affects investors as they may
end up losing their money. Many of these investments happen in the
small-cap market where millions of dollars can disappear in a matter
of a few days.
Lessons
to Learn
Investors
who might have got into traps of criminal investments before, or
those who are looking to invest in small-caps, there are few things
to learn from past experiences. They need to avoid investing in pump
and dump schemes that make promises which are too good to be true.
Also, putting money in stocks that are surging rapidly may not
sustain for long. Recently, the Financial Industry Regulatory
Authority (FINRA) has issued a warning for all the investors and
traders who are following marijuana small-cap stocks as many features
associated with these stocks are suspicious. Many of these stocks can
eventually prove to be scams. Both newbies and seasoned investors
need to consider these factors and carry out thorough background
checks on the stocks they want to buy.
Be
Inquisitive and Explore
More
and more research firms are launching new and innovative websites for
potential investors. These sites provide latest stock picks, news, market
trends, and interesting updates on various organizations. Many of
these portals focus on small-cap stocks, and how they are performing.
Members of these websites also have access to extensive lists of
equity research firms from where they can get research updates on
various domains. So, you can now become more aware of the market and
do your own research.