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MicroCapClub Indices

The MicroCapClub Indices showcase some of the best ideas we can find for the short-term and longer-term as profiled here on MicroCapClub


MicroCapClub has two indices including the MicroCapClub Active Index (MAI) and MicroCapClub Passive Index (MPI). The purpose of these indices is to highlight where we think some of the best opportunities are on MicroCapClub profiled companies. The characteristics of these indices are summarized as follows:

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MicroCapClub Active Index (MAI)
The MicroCapClub Active Index strategy is to contain a diversified collection of companies in the microcap space that appear to have favorable odds of significant near term appreciation. It is primarily a growth portfolio that follows Mike Schellinger's (aka @MikeDDKingMy Secret Recipe approach to investing although value and special situation companies also are included when they have favorable risk/reward profiles. The MAI will rarely be fully invested as cash is a position.  Purchases are only made when suitable ideas are available.

The MAI is managed by @MikeDDKing. The index was originally hosted on InvestorsHub from inception on 10/01/2009 where it was named the SwingTrade Portfolio. On 12/16/2016 it was moved to MicroCapClub and renamed the MicroCapClub Active Index.

MicroCapClub Passive Index (MPI)
The MicroCapClub Passive Index strategy is to own the best microcap businesses we can find to be held for the long(er) term or until the story changes. MPI will target quality businesses that are self funding compounding machines that have long-term growth prospects. Due to the more long-term nature of this index, the buy points aren't as valuation focused. The main qualifications desired for constituent companies are:

  • Sustainable Long-Term Growth Prospects > 3+ Years
  • Profitable
  • Market Leaders – Dominate a small market that is expanding
  • Owner Management and Board >10% of Outstanding Shares
  • Self-Funding – No need to raise capital
  • Low to No Debt
  • Clean Share Structure
  • Low to No Institutional Ownership

Many of the companies in the MPI will be in the MAI first and may be simultaneously held by both indices. 

The MPI is managed by @Ian Cassel and @MikeDDKing. It’s important to note that the MPI will NOT reflect a concentrated strategy but a diversified strategy with the aim of including quality longer-term microcap opportunities.  

Operating Mechanics
Trades in constituents of the indices are done in real-time during the trading hours to enable timely updates and to ensure that actual trading volume fairly enabled the trade. For example, we will not buy/sell 10,000 shares when only 100 shares traded at that price. A post is made in real-time on the board to indicate the trade. The portfolio valuation is updated at the end of each month. For quick reference, the end of month performance of the indices is located on the right sidebar or on the bottom. Note that the indices are not represented by actual brokerage accounts and thus there are no transaction costs. All transactions including those in foreign securities are in US dollars. 

Disclaimer
Note that these indices should not be construed as investment advice or recommendations to buy or sell securities. Mike Schellinger (aka MikeDDKing) and Ian Cassel often have positions in securities in these indices. They may transact in these securities at any time and without notice. Past performance is not an indicator of future results. Please visit our Terms of Use for a more complete disclaimer and discussion of the risks of investing.

3 topics in this forum

  1. MicroCapClub Indices Announcement

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  2. MicroCapClub Active Index (MAI)

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  3. MicroCapClub Passive Index (MPI)

    • 56 replies
    • 5643 views
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