Is it better to invest in a small unknown company or a big company?

I feel you won't make a lot of money by buying stocks that are worth way too much money when you could buy a stock that is under $10.

Clearly, it's best to buy into a small, unknown company that changes the world and becomes a gigantic company. The question: how do you find that needle in the haystack? Some would argue that you're better off buying the haystack.

I would consider buying the index instead of just one specific company.

What they said:)

@ Zachary L

I feel you won't make a lot of money by buying stocks that are worth way too much money when you could buy a stock that is under $10.

While mathematically it is easier to double a stock with smaller denominations really what you want to look at is the market cap and possible market. Or other metrics that would let you see future growth.

For this example (overly simplified) I will use Home Construction
https://finance.yahoo.com/news/united-states-construction-market-size-111400181.html
We are always looking at potential so it says by 2024 it will reach 1,819.1 billion dollars.

NVR a home construction company whose stock is about $4000 has a market cap of 14.92 billion. If there was absolutely no competitors by 2023 this stock has the ability to ~129x itself. Like I said an oversimplification because there are other competitors but if there weren't anyone you shouldn't be afraid of the large stock price because it still has more room to run.

As a reference though NVR (Price ~4000) Year to Date is up 8%
While the S&P 500 (SPY Price ~334.06) year to date is up abut 3%

So even with a larger price tag it's up more than the index SPY.

I don't want anyone to confuse this with indexing being bad. In fact indexing is safer and has more reliable returns. I just want to point out the fact that large stock prices may still outperform their cheaper counterparts. Because what matters is potential now ease mathematically.

Depends on your research and risk tolerance. Remember you can buy the whole market.