In this episode of Excess Returns, we sit down with Ian Cassel, founder of MicroCap Club and Intelligent Fanatics Capital Management. We explore the fascinating world of microcap investing, where Ian shares his expertise in finding and investing in ultra-small public companies.
We dive deep into Ian's investment philosophy, discussing how he identifies promising microcap companies, the importance of finding exceptional management teams, and his approach to portfolio management.
We cover:
- What defines a microcap stock and the size of the microcap universe
- The concept of "intelligent fanatics" and its importance in small company investing
- Why profitability and management quality are crucial filters
- How Ian approaches position sizing and portfolio concentration
- The importance of setting proper capacity constraints in microcap investing
- Why turnover can actually be beneficial in microcap portfolios
- Red flags for individual investors to watch out for
Whether you're an experienced investor or just getting started, this conversation offers valuable insights into an often overlooked corner of the market where significant opportunities can still be found.
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