Back in the good old days of the late '90s, there was something called the small-cap initial public offering (IPO). This was a public offering priced in such a way that a company would raise about $20 million or so.

Of course, the small-cap IPO investor went away for several years. True, there were a few exceptional small-cap offerings, such as (NASDAQ:OSTK) and Taser (NASDAQ:TASR), but these were mostly aberrations.

Well, it looks like small-cap IPOs are back again -- and, as was the case with the '90s, these issues are quite volatile. Take InfoSonics Corporation (AMEX:IFO). The company is a distributor of handsets in the U.S. and Latin America.

The company priced its IPO in June at $6 per share. It was a tiny offering, with a mere 2 million shares offered to the public. Unfortunately, the stock proceeded to decline, hitting a low of $3.02.

But, on Monday, a day before its quarterly report, the stock went berserk. Volume was 550,900, which compares with an average daily of 13,136. The stock surged from $3.25 to $4.70. The chat boards lit up with a frenzy of activity.

And, on the announcement of the company's earnings on Tuesday, the stock plunged 22% to $3.63. Clearly, day traders are back, and they have targeted a fertile area: recent IPOs. No doubt, this has been the case with the run-up of Google (NASDAQ:GOOG).

There are a variety of other small-cap IPOs that have attracted active traders. In April, for example, Jed Oil went public at $5.50 per share. Now, the stock trades at $12.71.

There is Interchange (NASDAQ:INCX), which recently priced its offering at $8, raising only about $22 million. The company is in the paid-search industry, with about 5,000 direct advertisers. As Google caught fire, so did Interchange, which currently trades at $20.40.

There are similar performances from companies such as (NASDAQ:ECST) and WebSideStory (NASDAQ:WSSI).

So, of course, expect a flurry small-cap IPOs to feed on for the first part of 2005. And expect lots of volatility.

Fool contributor Tom Taulli does not own shares mentioned in this article.