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Sometimes big things can come and small packages the Russell 2000 hit an all time intraday high today it's six in a row and it has been outperforming the other US indexes.
Over the last several months so obvious question is now a good time to get into small cap stocks little.
According to Barry Randall Crabtree asset management it is his small cap tech fund actually outperform seeing the Russell 2000 -- No small feat and he is here with some of his favorite small cap stocks.
I cannot count how many times people come on starting 34 years it up.
Small -- rallies over it's been going for ten years this thing is it's such a cliche to say the Energizer bunny -- my mother would say then don't say it.
But it isn't that the bunny just going on and on and on -- How much longer does it have the energy to.
And an end and you bring up the timeframe I started hearing these think -- is about two years ago.
People saying that small -- rover and it was over and ever since then people have been renewing that promise.
But the fact is -- small -- historically performed well vs large caps just put some numbers -- -- in the last ten years.
Yes -- 500 a large cap index has gone up and an annualized basis of five point 3%.
-- is the Russell 2000 which -- gone up eight point 1% on an annualized basis so the numbers support the idea that small -- perform historically.
And I don't think there's any reason to believe that that's gonna stop anytime soon -- the respect.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- But what are the risks when you want to maybe look at something LA go over 8% return big vs the S&P 500 you've got to look at that so what are the risks.
Well the risk for small cap in particular if if you're invested in high quality small caps the risks largely come from outside to come from political risk economic risk headline risk.
-- so you did the goal when you're selecting stocks for portfolio or for your individual investor.
Is to -- high quality names that can endure some of that risk headline risk ups and downs and bounces from the market.
As far as its specific risk obviously that's unique to any particular company I could talk about that with some of my favorite names.
And then -- -- -- -- get to one because this is fascinating the one that we're going to start with.
And I see which is actually.
Tax revenue isn't still climbing out of recessionary -- unemployment rates -- -- -- You still believe that's a risk worth taking with.
That's an excellent question excellent -- -- The thing about ego that's unique is that virtually all of their state customers and they have thirty they run thirty of the fifty US states.
Well -- so -- Maine dot gov for example is where is run and operated by the primary the primary risk there is that is payment risk.
But the reality is that most of the need God's business is on -- split payment business in other words instead of collecting tax revenue and and paying.
-- someone to build your website what they do is collect fees based on whatever the -- studies used for so if you renew a fishing license or you wanna stay in a state park have to pay a fee for that -- So this sidesteps the usual funding problem for anything related to a state operated business so.
There they they've been doing this 123 years.
They're basically a monopoly either the state doesn't themselves or they hire.
Of the top ten -- populous states Texas.
Met -- what about is it pronounced IMAX technology I mean you've got -- that there upload 246%.
Over the last 52 -- -- -- -- -- making this stuff that I touch when I do an iPad screeners -- a tablet like that.
You -- Be depending upon the manufacture of the tablet but what they make our driver chips.
That drive any kind of flat panel display whether it's a large screen TV all the way down to something like Google glasse which they are reported to be designed into.
And you and I can disagree on whether or not Google last -- be a success but -- Max has a broad customer list.
They generates a lot of cash and even despite the returns that you just described the stock is not especially expensive at this time.
Moreover there are recently earnings estimates have been going up for the company giving me a lot of confidence going forward -- mean nothing is certain but a lot of the signs -- very positive for high IMAX right now.
Let me get to your last -- and that's tetra -- tech TT EK and and this is an opportunity for the environment told -- -- people who -- people who -- looking to -- sort of -- things -- talk about this name it is far from its 52 week -- unlike.
True yet I'd tell -- trend is in the business largely of the engineering and remediation when it comes to environment delicious so for example.
States will employ -- tech.
Two clean up to re mediate Brownfield sites or to do engineering work in preparation for things like.
Fracking or other types of drilling.
So the large -- -- a mega trend that's going on with stuff fracking and -- horizontal drilling someone favors -- -- recent difficulties results are the results of external issues.
The US government's is engaged in a little bit of RG RG -- them as it relates to payables but the tables are not really in dispute.
And then -- some of their Canadian operations have run afoul of some of the smaller issues -- overall the trend is intact with tetra despite these recent issues.
Very Randall Crabtree asset management founder and CIO great to have you here and thank you for those comments on those picks and we will put welcome.
He will put his picks up on FaceBook dot com slash after the bell.
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