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9 Small-Cap Stocks With Wide Moats

These high-quality small-cap firms may deserve a place on your watchlist.

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The prospect of earning a premium for investing in small-cap companies is compelling. The so-called small-firm effect posits that companies with smaller market caps tend to outperform the market as a whole.

You can see from the index data that small caps have had a slight return advantage over the past 10- and 20-year periods; however, when that return is adjusted for risk (as measured by standard deviation) the advantage all but evaporates.

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Karen Wallace does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.