78.3% Of Research Into New Small-Cap Investments Comes From The Web

As some of you may have noticed, we love to take surveys because of the valuable data they provide. Despite the fact we’re an online company, quite a number of our surveys are done offline (i.e. at conferences). Why? There’s no point in trying to figure out the impact of the web on small-cap investors if you’re only going to ask online people.

To this end, here is some incredibly valuable information that we discovered about small-cap investors over the last 12 months:

In 2008

• The web accounted for 74.3% of all research into new small-cap investments, up from 67% in 2007
• 73% of Investors Conduct the Majority of their Research (75%+) into New Stocks Online
• 48% of Investors Conduct All of their Research (95%+) into New Stocks Online
• 64% of Investors Use Discussion Forums For Information and/or Research, up 7% from 2007

In 2009

• The web accounted for 78.3% of all research into new small-cap investments, up from 74.3% in 2008
• 73% of Investors Conduct the Majority of their Research (75%+) into New Stocks Online, up from 73% in 2008
• 55% of Investors Conduct All of their Research (95%+) into New Stocks Online, up from 48% in 2008
• 54% of Investors Use Discussion Forums For Information and/or Research, down from 64% in 2008

Clearly, small-cap investors are overwhelmingly using the web to research new investments. We didn’t get as far as asking why they rely on the web so heavily but one answer has to be the fact that major financial media don’t cover small-cap stocks extensively. As such, small-cap investors are forced to resort to search engines, electronic shareholder forums and social networks to help them discover new small-cap stocks.

I hope you found this information to be helpful. If you’re a small-cap CEO that isn’t conducting a significant online investor relations program, take this data to your board …. and then call me Hey, couldn’t resist. The data is just that good.

Regards,
George