{"id":40890410,"date":"2024-02-25T11:35:57","date_gmt":"2024-02-25T06:05:57","guid":{"rendered":"https:\/\/stockviz.biz\/index.php\/?p=40890410"},"modified":"2024-02-25T11:35:57","modified_gmt":"2024-02-25T06:05:57","slug":"market-cap-deciles-and-circuit-limits","status":"publish","type":"post","link":"https:\/\/stockviz.biz\/index.php\/2024\/02\/25\/market-cap-deciles-and-circuit-limits\/","title":{"rendered":"Market-cap Deciles and Circuit Limits"},"content":{"rendered":"\n<p>Our <a rel=\"noreferrer noopener\" href=\"https:\/\/stockviz.biz\/index.php\/2024\/02\/10\/market-cap-deciles-and-illiquidity\/\" target=\"_blank\">previous post<\/a> discussed how liquidity drops exponentially as the market cap gets smaller. This illiquidity also means that a lot of micro-cap stocks spend their time out of the market.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" src=\"https:\/\/github.com\/stockviz\/blog\/blob\/master\/mcap-class\/circuits-mkt-cap.decile.png?raw=true\" alt=\"\" \/><\/figure>\n\n\n\n<p>This is a problem for direct equity investors in micro-caps if they actually try to bank the price appreciation they might have seen in the stocks that they own. And a bigger problem for momentum algorithms in the small-cap space.<\/p>\n\n\n\n<p>Index funds in the micro-cap space have yet to go through a test of the liquidity mismatch between allowing redemptions at daily NAV vs. not being able to trade the underlying stocks for days on end. <\/p>\n\n\n\n<p>Bull markets allow us the luxury of coming up with a plan for something that has plenty of historical precedent.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Our previous post discussed how liquidity drops exponentially as the market cap gets smaller. This illiquidity also means that a lot of micro-cap stocks spend their time out of the market. This is a problem for direct equity investors in micro-caps if they actually try to bank the price appreciation they might have seen in &hellip; <\/p>\n","protected":false},"author":2,"featured_media":2106273,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3471],"tags":[2761],"class_list":["post-40890410","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing-insight","tag-quant","entry"],"_links":{"self":[{"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/posts\/40890410","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/comments?post=40890410"}],"version-history":[{"count":0,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/posts\/40890410\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/media\/2106273"}],"wp:attachment":[{"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/media?parent=40890410"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/categories?post=40890410"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stockviz.biz\/index.php\/wp-json\/wp\/v2\/tags?post=40890410"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}