If you are looking specifically in equities or stock wise right as a part-time retail trader, I would really suggest that instead of focusing too much on all those very popular blue chip stocks, you might want to look more towards small-cap stocks and mid-cap stocks. The reason is being because, usually for small-cap and mid-cap stocks, fundamentally there’s actually much more room for growth, which means that there is potential to see very sharp climb and movements for those small to mid-cap stocks.

Generally, for small-cap stocks, the definition for small cap-stocks is between 300 million to two billion. While mid-cap stocks, it’s about two billion to $10 billion a day. It’s based on market capitalization. Alright? Sorry, I forgot to add in the word market capitalization. Generally, if you look at small-cap to mid-cap stocks, they are actually very liquid enough for most of us as a part-time retail trader.

Of course, there’s another even smaller category, for example, micro-cap and nano-cap, which will be in the tune of 50 million to between 300 million. For those stocks, they could potentially be quite ill-equipped so that’s the reason why I suggest focus from at least small-cap to mid-cap onwards.

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Philip Teo

Founder & CEO at Traderwave Pte Ltd
Philip Teo is an entrepreneur, speaker and trading coach who specialises in the field of Technical Analysis of the financial markets. He is currently the Founder and CEO of Traderwave Pte Ltd, a financial technology company that offers a web charting application to global traders. He has conducted many trading seminars and appeared on national television before. He is also currently an official speaker and trainer with SGX Academy. Learn more about him at his Google+ Profile, LinkedIn Profile and Facebook Profile

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