Monetary Conditions Favor Smaller Firms According To Historical Data
DUNCANVILLE, Texas, June 24 /PRNewswire/ -- Smaller capitalization firms
have historically performed well when monetary conditions are easing according
to a recent study published by Morningstar Five-Star fund manager Joseph R.
Dancy, Adjunct Professor of Law at Southern Methodist University and manager
of the LSGI Venture Fund L.P.
'The small-cap effect -- the tendency for smaller companies to perform
better than larger firms -- is most pronounced when monetary conditions are
accommodative. The relationship between monetary policy and small cap out-
performance is statistically significant and pervasive across markets and time
periods,' said Professor Dancy.
Fortune Small Business magazine recently released a list of the fastest
growing 100 small public companies based on revenue and earnings growth and
return to investors in their July 7, 2008 issue. Many of these firms have
attractive quantitative attributes that may be attractive to investors looking
for capital gains according to Dancy.
Dr. Dean Johnson, Professor of Finance and Director of the Applied
Portfolio Management Program (APMP) at Michigan Technological University's
School of Business and Economics, commented, 'The small capitalization sector
is a very inefficient part of the market and therefore provides opportunities
for active managers to generate excess returns.'
The Fortune Small Business 100 fastest growing list includes nine
companies that are in the LSGI portfolio, including Arena Resources (NYSE:
ARD), Bolt Technology, Ebix (Nasdaq: EBIX), GeoResources Inc. (Nasdaq: GEOI),
PrimeEnergy, Almost Family, Balchem (Nasdaq: BCPC), Key Technology(Nasdaq:
KTEC) and Art's Way Manufacturing (Nasdaq: ARTW).
The study of historical market data, small stock performance, monetary
conditions, and the ability of active managers to generate excess returns is
available at the LSGI Advisors Inc. website at www.lsgifund.com . The LSGI
Venture Fund L.P. is a Morningstar Five-Star rated fund.
About LSGI Advisors:
LSGI Advisors Inc. manages the LSGI Venture Fund L.P., a Texas limited
partnership.
For more information please visit: http://lsgifund.com/
Email: jdancy@smu.edu
For More Information, Contact:
Joe Dancy, LSGI Advisors Inc.
972-780-1805 office
214-263-5201 cell
SOURCE LSGI Advisors Inc.
