Small Companies Are Gone, but Should They be Forgotten?

Quoting from this article, “The number of stocks has halved over the past two decades, to less than 3,600 from nearly 7,400, with most of the declines coming among the smallest companies.” According to a March 2017 Journal of Financial Economics paper by Doidge, Karolyi and Stulz, the U.S. has “abnormally few listed firms” compared with other countries; this “U.S. listing gap” is apparently due to a decrease in new listings coupled with an increase in delistings over this period.

How much should you care about the decline in the number of publicly traded companies?

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