Posted by: Ben Steverman on June 13, 2008
To start the weekend, here are some intriguing blog posts on the stock market and investing:
2. Jeffrey Miller, on the blog “Dash of Insight,” put together a page of his best blog posts. His goal is to provide some good resources for individual investors, and there is some good stuff there, including advice on how to avoid big mistakes, and how and when to listen to experts.
3. How much extra return to small-cap stocks provide, in exchange for the higher risk associated with smaller companies? How should value investors play the micro end of the market? James Picerno at the Capital Spectator has some interesting thoughts and reporting on a new effort to find undervalued micro-cap stocks.
4. Tim Sykes has an interesting post on TradingMarkets on the benefits of using limit orders rather than market orders. Eddy Elfenbein at Crossing Wall Street offers his thoughts, as someone who uses market orders.
It’s a classic debate among investors and traders, and I’d just add that some recent academic research seems to side with the market order crowd. As I noted late last year, the problem is that limit orders turn “stale,” especially when news breaks or sentiment shifts. Sykes probably uses limit orders in a way that limits this danger, but at least some evidence suggests many amateur investors use them incorrectly.