Should I factor in market caps or returns more heavily when deciding what companies to invest in? 

I'm new to purchasing stocks. Should I factor in market caps or returns more heavily when deciding what companies to invest in? 

Investing, Stocks
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February 2018

I wouldn't give either much weight (depending on what you mean by "returns.")  In order to be a successful long term investor you need to buy a diversified collection of well-run, profitable, growing, financially sound companies.  It does not particularly matter if these companies are large-cap, mid-cap or small-cap (though many would argue that smaller companies give higher long term returns, it's not a clear correlation).

Look at ROIC and free cash flow for indicators of future financial health.  They are much better valuation tools than P/Es.  Get to know companies over time before investing.  Then, when a market dip affords an attractive entry point, buy.

January 2018
January 2018
January 2018