WATCH: From little acorns, mighty oaks will grow

Small caps in South Africa have been provided with big returns during the pandemic, as we’ve seen a number of counters exit a years long sideways cycle and rerate significantly on the prospect of pro-growth economic reforms, as well as the potential for buyout activity with many foreigners sniffing around for a dripping roast.

By the end of August, the all share index had risen about 17% and the mid-cap index was ahead 18% on the year to date. However, both increases pale into insignificance when compared with the 29.2% gain in the small-cap index.

What’s hot and likely to remain hot, and where are the gems for investors to consider?

Michael Avery is joined by Small Talk Daily’s Anthony Clark who covers about 100 stocks in the small- to mid-cap industrial and financial space, and Keith McLachlan, investment officer at Integral Asset Management.