CAP is a term acronym for capitalization, the current market value of a stock, representations of the size of the stock. There are 3 sizes are there. Namely they are, Small caps, Mid caps, Large caps…
This simple classification of shares is made into 3 categories. They are large-cap, mid-cap, small-cap. This classification is categorized based upon the proportional size of the share market of a country.
SMALL-CAP STOCKS
- These are stocks of small companies that are listed.
- There is scope for rapid grow in the market
- These small cap stocks have proved potential growth in the previous days to till date.
- As company grows the value of stocks also grow into high value and attracts a massive customers.
- So these small-cap stocks are best option for long term investor.
- The companies that have less than 200 to 250 crores as market capitalization are normally known as small cap stocks.
The current days Initial Public Offerings are belonging to small-cap companies stocks.
MID-CAP STOCKS
- Mid-cap stocks are the stocks of medium-sized companies that are listed.
- These mid stocks are well known seasonal performers.
- These stocks are offered by companies that are well established and with development plans.
- The companies that have less than 200 to 4000 crores as market capitalization are normally known as mid cap stocks.
- These mid-cap stocks are best option for long term investors as well for short term traders. For investors of short term trading, advised that do not expect immediate profits returns upon invested money.
LARGE-CAP STOCKS
- These are the stocks of larger companies including blue chip stocks firms.
- These companies have well brand image in the market with a potential customers or clients networks and dealers, distributors, authorized centers etc.
- Ex: Apple, Mc Donald, Reliance, Adithya Birla, Tata etc. are well-known for large-cap stocks.
- These large cap stocks companies have a scope for potential grow in the market along with new business opportunities and with investment diversification into new sectors.
- These large-cap stocks are best option for long term investors. The long term investors can earn industry best and high dividends.
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