Five Maverick Small-Cap Stocks for a Volatile Market
This column was originally published on RealMoney on June 7 at 10 a.m. EDT. It's being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.
The market has been on a roller coaster ride in recent weeks, charging higher one day and selling off the next. It's been a volatile brew that can turn huge profits or trigger extreme heartburn. In either case, traders are working hard for every dollar they earn these days, because even small lapses in concentration are triggering very unpleasant results.
When the indices churn through this level of volatility, I take a giant step back and look for stocks that move to the beat of their own drummer. These are the maverick issues immune to the big picture, attracting buying interest that doesn't depend on "Mad Money's" stockmeister or the latest data on interest rates.
In general, these plays don't fall into any particular sector or theme. However, most are speculative issues in which the company's current profitability isn't the primary reason for buying or selling. The category also favors small biotech or metals stocks, because those segments enjoy huge paydays when their stated plans carry to fruition.
Of course there's greater risk in trading standalone stocks because many things can go wrong on the journey to sustained growth. So get your stop placed as soon as you take a position and don't hesitate to jump ship if the Cinderella story starts to unravel.
Please note that due to factors including low market capitalization and/or insufficient public float, we consider Transcend Services, Ceragon Networks, Englobal, Premier Exhibitions and Premier Exhibitions to be small-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV