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While large-cap stocks may bring stable returns, some investors turn to small-cap stocks due to their lower prices and growth potential. Investors who choose to explore such smaller companies should observe their operations and offerings, which would allow them to understand the risk and reward ratio, before going forward with investments. Investors often seek out stocks of small-cap companies for their lower prices. While they can have certain risk factors, some of them often come with the potential of delivering good returns in the future. Extra gains like regular dividend payouts can also be an added bonus when investing in such stocks.