Opportunities with Secondary Values – Invest Now?

Last Updated: 27. November 2023By

Today we take a look at an often neglected but exciting segment: the small and mid-caps.

Current state of small and mid-caps Despite critical voices about the German economy, many small and mid-caps are historically undervalued, which presents interesting opportunities, particularly with so-called Hidden Champions. These often unknown global market leaders, mainly from German medium-sized businesses, present themselves as solid and promising investments.

Why small and mid-caps are interesting now In recent years, large caps have outperformed small and mid-caps, but this development stands in contrast to the trends of the last ten years. This currently creates an attractive environment for investments in small caps, also because they are interesting for takeovers due to their favorable valuation.

The role of the Hidden Champions More than 1,500 Hidden Champions worldwide come from Germany. These companies are not only market leaders in their niches, but also drivers of innovation and indispensable for industry trends such as the energy transition. Their products are often indispensable and enable them to generate profits and grow even in difficult times. The great art is to identify Hidden Champions in good time to participate early in the growth of these.

Conclusion The current market phase offers investors the rare opportunity to focus on robust and growth-oriented small and mid-caps. Investments in these companies, especially in Hidden Champions, can be promising both in the short and long term.