Looking for growth in small cap

At the start of 2009 markets were in freefall, there were concerns about financial and economic meltdown and the last place you wanted exposure to was smaller companies with their higher risk and greater exposure to the domestic economy.

A year on and small companies, as represented by the FTSE Small Cap (ex Investment Trusts) delivered a return of 58.2% for 2009, outpacing the FTSE 100 which returned 27.9% over the same period and representing the best absolute performance from small companies over the last 16 years. Even the much-maligned FTSE AIM All Share Index joined in with a strong year returning 68.3% by total return. This could not have proved a stronger contrast to 2008, when small companies returned – 50.4%, their worst performance in the last 16 years. In the context of these significant returns and the rever...