Small Cap

Small Cap
Refers to stocks with a relatively small market capitalization. The definition of small cap can vary among brokerages, but generally it is a company with a market capitalization of between $300 million to $2 billion.
One of the biggest advantages of investing in small-cap stocks is the opportunity to beat institutional investors. Because mutual funds have restrictions that limit them from buying large portions of any one issuer's outstanding shares, some mutual funds would not be able to give the small cap a meaningful position in the fund. To overcome these limitations, the fund would usually have to file with the SEC, which means tipping their hand and inflating the previously attractive price. Keep in mind that classifications such as "large cap" or "small cap" are only approximations that change over time. Also, the exact definition can vary between brokerage houses.
What Is A Small Cap? - If you don't realize how "big" small-cap stocks can be, you'll miss some good investment opportunities. Introduction to Small Caps - Find out about the pros and cons of small-cap stocks and whether they ought to be in your portfolio. Market Capitalization Defined - Find out the difference between mega-, large-, mid- and small-cap stocks. We show how each suites particular investing styles. The Great Gap - Wall Street is myopically focused on a minority of large-cap stocks, leaving the majority of stocks under-followed and undervalued.