Dueling Fools

Dueling Fools
July 14, 1999

The Biggie Smalls Duel

Where do you draw the line between risk and reward? Does size matter? This week we pit the blue chips against their smaller capped brethren. While a diversified portfolio should ideally have both large and small companies some folks, and Fools, clearly lean one way or the other.

Bill Barker (TMF Max) favors the large cap companies while Warren Gump (TMF Gump) prefers the smaller equities. So, put on your thinking cap for a Duel on market caps!

Who will win? You will get to decide. After you're done, why not check out our Duel Flashback where we take a look back at the not so soft side of Sears (NYSE: S).

You Get to Vote!

Once you've read the arguments and the rebuttals, it's your time to cast your vote. We'll tabulate results each week and revisit them from time to time to see whether you were right! As always, we invite you to join us in the Dueling Fools Message board to continue the duel.

[Any suggestions, comments, praise, or flames, please send them along to the Dueling Fools Team.]

Blue Chips Argument...
Simply put, the data over the last 60 years is pretty clear: when you're in good economic times, large caps are going to outperform small caps -- and by a meaningful amount.
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Small Caps Argument...
The most compelling reason to consider small-cap stocks boils down to common sense. When buying a stock, you are doing nothing more than acquiring a piece of paper that entitles you to a small sliver of a company's assets and future earnings stream. Based on current market conditions, you would be crazy not to investigate small-cap issues.
Continue...

Results for last week's Dell Duel

Answer Percentage
I can't make up my mind

2%

TMF Yi-Hsin's Bull argument

73%

TMF Edible's Bear argument

14%

They were both excellent

8%

They were both lame

1%