European smaller companies – worth holding?

aroominyork

Linton wrote: »

Trustnet/tools/charting . The figure was the best I could estimate from the graph, the facility doesnt provide tabulated figures.

How do you get 10 or 20 - or anything over 5 - years on Trustnet please?

masonic

aroominyork wrote: »

How do you get 10 or 20 - or anything over 5 - years on Trustnet please?

You go to the advanced charting and you can adjust the date range to your hearts content.

aroominyork

masonic wrote: »

The bottom end of the FTSE 100 is "small cap".

By what definition? A quick google gave me Investopedia saying "The definition of small cap can vary among brokerages, but it is generally a company with a market capitalization of between $300 million and $2 billion." That's a stretch less than the lower end of the FTSE100 which is Rightmove at £4.4bn, and my guess is that the UK's small cap would be lower than the US's small cap.

Linton

aroominyork wrote: »

How do you get 10 or 20 - or anything over 5 - years on Trustnet please?

Look on Trustnet - tools - charting. You will see a button for time scale. Initially it just shows years back to 2003. Having selected a date in 2003 look again and you can go back further to 1993 etc etc.


If you change the items displayed you will have to reset the timescale.

aroominyork

Linton wrote: »

Look on Trustnet - tools - charting. You will see a button for time scale. Initially it just shows years back to 2003. Having selected a date in 2003 look again and you can go back further to 1993 etc etc.


If you change the items displayed you will have to reset the timescale.

Yup, got it. Thanks!

masonic

aroominyork wrote: »

By what definition? I quick google gave me Investopedia saying "The definition of small cap can vary among brokerages, but it is generally a company with a market capitalization of between $300 million and $2 billion." That's a stretch less than the lower end of the FTSE100 which is Rightmove at £4.4bn, and my guess is that the UK's small cap would be lower than the US's small cap.

The sentence right before the one you quoted states: "Small cap is a term used to classify companies with a relatively small market capitalization"
(my emphasis)

Please also remember that the $300m-$2bn limits used in investopedia must be increased and decreased in line with market performance. I don't know when this number was arrived at, but markets could have grown quite considerably since then. Similarly, if we had a severe market crash which wiped 50% off the value of the index, it wouldn't make sense to use the same limits. But one thing that shouldn't matter when judging a company's size, is which country's stockmarket it happens to be listed in - many companies trade globally after all.

If you want to nit-pick, then we need to introduce another term to further confuse you - and that's "mid-cap". "Mid-cap" companies are smaller companies that are larger than "small caps", but are not regarded as "large caps".

Remind me, did you come here asking for advice or to pick a fight?

A_T

aroominyork wrote: »

Can you point me to a small cap index? I don’t think there is any such thing.

FTSE Small Cap ex Invt Trust
MSCI United Kingdom Small Cap Index
MSCI World Small Cap Index
MSCI Japan Small Cap Index

aroominyork

masonic wrote: »

The sentence right before the one you quoted states: "Small cap is a term used to classify companies with a relatively small market capitalization" (my emphasis)

I think you are emphatically contradicting yourself. Indeed, everything is relative, so a European small cap index consists of companies that are small cap in the relative context of the European market. And that would, by any sensible measure, surely exclude FTSE100 companies.

masonic

aroominyork wrote: »

I think you are emphatically contradicting yourself. Indeed, everything is comparative/relative, so a European small cap index consists of companies that are small cap in the context of the European market. And that would, by any sensible measure, surely exclude FTSE100 companies.

There's no contradiction at all because the FTSE100 index is defined as the 100 largest companies (by market cap) listed on the London Stock Exchange.

Developed Europe makes up 22% of world markets, so is more than four times the size of the UK market. So relatively there is even more chance something in the FTSE100 would make it into a European small cap index, which in fact is exactly what's happened.

aroominyork

masonic wrote: »

There's no contradiction at all because the FTSE100 index is defined as the 100 largest companies (by market cap) listed on the London Stock Exchange.

Developed Europe makes up 22% of world markets, so is more than four times the size of the UK market. So relatively there is even more chance something in the FTSE100 would make it into a European small cap index, which in fact is exactly what's happened.

When you invest in a small cap fund do you really, intuitively, think you are investing in the FTSE100? "There are basically three sizes of listed companies: large caps, mid caps, and small caps (cap is shorthand for market capitalisation). Broadly, large cap means the FTSE 100, mid cap means the FTSE 250 and AIM 50, and small cap means anything smaller than these." http://www.whatinvestment.co.uk/choosing-between-large-mid-and-small-caps-2118443/