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Small and Mid-cap Perform Better Than Blue Chip Stocks

2012 has so far been an auspicious period for small and mid cap indices, as they out perform their large-cap peers.

Gains in the small-cap index of the BSE have so far achieved a return of 28%, from the start of 2012, with the mid-cap index following suit, achieving a 27.5% for the period. In contrast, the blue chip Sensex index was only able to marshal an 18% gain for the period.

Small Cap & Mid Cap perform better than Blue Chip Stocks

Small Cap & Mid Cap perform better than Blue Chip Stocks

A majority of stocks in the small to mid cap section experienced a lackluster performance last year, due to rising interest rates which affected financial performance. This later led to a 42% and 34% drop, in small and mid cap stock prices, respectively. However, the Sensex was able weather this depressed market somewhat better, only experiencing a 25% drop in prices during the same period.

Market pundits recommend that investors take advantage of this trend, to capitalize on stocks with weaker fundamentals.

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