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Small-cap stocks can outperform the STI, if investors know where to look

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Yong Jun Yuan

Yong Jun Yuan

Published Mon, Mar 20, 2023 · 05:50 AM
    • Analysts expect that small-cap property plays such as Propnex could do well in 2023.
    • Analysts expect that small-cap property plays such as Propnex could do well in 2023. PHOTO: BT FILE

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    INVESTORS tend to focus on blue-chip stocks on the benchmark Straits Times Index (STI). But market watchers say small-cap counters should not be overlooked as they could offer portfolio diversification and deliver market-beating opportunities.

    However, analysts suggested that investors, before casting their lots with these small-cap stocks with a total market value of less than S$2 billion, should pay close attention to their underlying businesses, and their track record for paying dividends.

    According to Azure Capital chief executive Terence Wong, investors should take a closer look at small-cap stocks with good track records, especially those that have delivered dividends despite challenging times.

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