US Small Cap Stocks 2017: A Golden Opportunity for Investors

In 2017, the United States saw a surge in the performance of small cap stocks, offering investors a golden opportunity to capitalize on high growth potential. This article delves into the reasons behind the upward trend and highlights key small cap stocks that emerged as leaders in the market.

Understanding Small Cap Stocks

Small cap stocks refer to shares of companies with a market capitalization of less than $2 billion. These companies are often in the early stages of growth and have the potential to offer higher returns compared to larger, more established corporations. However, they also come with higher risks, as these companies may face financial and operational challenges.

The 2017 Market Surge

In 2017, the US small cap stock market experienced a significant surge, driven by several factors:

• Economic Growth: The US economy was on a strong footing, with low unemployment rates and increasing consumer spending. This favorable economic environment provided a conducive atmosphere for small cap companies to thrive.
• Tax Reform: The Tax Cuts and Jobs Act of 2017, which aimed to stimulate economic growth and reduce corporate tax rates, had a positive impact on small cap stocks. The lower tax burden allowed these companies to reinvest in their businesses and expand operations.
• Favorable Interest Rates: The Federal Reserve's decision to keep interest rates low in 2017 supported small cap companies, as they could borrow at affordable rates to fund their growth initiatives.

Top Small Cap Stocks of 2017

Several small cap stocks emerged as leaders in the market in 2017. Here are a few notable examples:

• Tesla, Inc. (TSLA): As the world's leading electric vehicle manufacturer, Tesla experienced a surge in sales and market value in 2017. The company's innovative products and commitment to sustainability made it a favorite among investors.
• NVIDIA Corporation (NVDA): This technology company, known for its graphics processing units (GPUs), saw a significant increase in demand for its products, particularly in the gaming and data center sectors.
• Shopify Inc. (SHOP): As an e-commerce platform provider, Shopify experienced rapid growth in 2017, driven by the increasing trend of online shopping and the company's expansion into new markets.

Conclusion

The 2017 US small cap stock market offered investors a unique opportunity to capitalize on high growth potential. By understanding the factors that contributed to the surge and identifying key companies in the sector, investors could potentially achieve significant returns. However, it is important to remember that investing in small cap stocks carries higher risks, and thorough research and analysis are essential before making investment decisions.