Alert: CAPS Rule Change. Average Daily Trading Volume Requirement for Stocks
Just wanted to give everyone a heads up that on the evening of June 9th (two weeks from today), we will make a change to the threshold requirements that determine whether or not a stock can be rated in CAPS. Today, we require a stock to have a market cap of $100MM and a share price of $1.50.
As we've previously discussed, the problems with the current threshold is that sometimes some very liquid stocks are excluded from our ratings while some stocks that meet our rating threshold are very illiquid. Based on your feedback, we've decided to change the rating threshold to the following: Stocks must have an average daily trading volume >= $50,000
Based on our current analysis, I expect the impact on the rated stock universe to be neutral. The total number of rated stocks is unlikely to change materially. But, we'll do a better job of ensuring that we are covering stocks that are liquid enough to be of interest to Foolish investors.