Small Cap and Microcap ETFs

Each index provider has a different definition for small cap and micro cap stocks within exchange traded funds (ETFs). For example, the S&P defines small cap as companies with a market cap of $300 million to $1.5 billion, but the Dow Jones looks at the largest 5,000 stocks and numbers 751 through 2,500 are put in the Wilshire Small-Cap Index and numbers 2,501 through 5,000 are placed in the Wilshire Micro-Cap Index.

With small cap and micro cap ETFs defined, Seeking Alpha offers investing suggestions on how to use them:

• Ways to diversify your portfolio
• When to use micro cap ETFs
• Tips on shorting micro cap ETFs
• Which ETFs are best for hedging
• When to exercise caution