Small cap stocks is one area you absolutely want to be the first guy in the door, so you can grab the most money.

For months now, I’ve been trying to analyze the current small cap stock market conditions. Often times, I show up early to the party.

But you know what? That just means more profits while the others catch up. Let me give you some examples - and show you the next best place for profiting from small cap stocks…

Jump In Early And Get The Pick Of The Small Cap Stocks Profits

While every investor dreams about uncovering “the next Microsoft,” investing in it very early, and riding it all the way to the bank for millions, it doesn’t happen often. But many times, it’s not just a case of identifying hot stocks. It’s about spotting hot trends.

For example, in late 2005, we jumped on board a fast-growing technology company called Immersion (Nasdaq: IMMR) - a leader in the “haptics” and force-feedback field. We’ve since mentioned their cutting edge technology many times.

May 2006, I wrote about the increasing shift towards the ethanol industry and the investments within it. I then made a specific recommendation for Xcelerated Profits Report subscribers on a “stealth” ethanol play (in order to reduce our risk in what was, and still is, a young and volatile area), which we cashed out of for a 35% gain.

In October 2006, I sounded the alarm bells about an impending real estate collapse and then followed it up with more advice in June 2007.

We also grabbed 54% gains in August 2007 on the ultimate contrarian play at the time: Downside in the Chinese market (via the iShares FTSE/Xinhua China 25 Index - FXI). Believe me, very few people were calling for a China decline back then - and you should have seen the baffled enquiries I received from some colleagues when I recommended the play!

So how about the current market? What small cap stock opportunities do we have now?

Rookies Sell In Fear… Smart Investors Grab The Small Cap Stocks For A Bargain

While you’ll find many commentators labeling the current crisis as one of liquidity, I look at it differently. I’m adamant that it’s more of a crisis of confidence, not liquidity. After all, while fear and greed are the two primary forces that drive the stock market, if investors don’t have confidence, then there’s a problem.

Here’s what many rookies don’t understand, though: The huge dips that we’ve seen in the market - especially in some of the financial sector stocks - have presented great opportunities to buy, not sell.

Here’s why I take this contrarian stand on financials, housing, China, and the U.S.