Small-capitalization stock

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Small-Capitalization Stock

A stock in a publicly-traded company with low amount of market capitalization. In general, a small-cap company has a market capitalization of less than $1 billion or $2 billion, but there is no specific definition. Some brokerages or exchanges have slightly different definitions of small-cap. Some indexes track small-cap companies, as do some exchange traded funds. See also: High-cap, Mid-cap.

Small-capitalization stock.

Shares of relatively small publicly traded corporations with a total market capitalization of less than $2.3 billion are typically considered small-capitalization, or small-cap, stocks.

That number is not used uniformly, however, and you may find small-cap defined as below $1.5 billion. Market capitalization is calculated by multiplying the market price per share by the number of outstanding shares.

Small-cap stocks, which are tracked by the Russell 2000 Index, tend to be issued by young, potentially fast-growing companies. Over the long term -- though not in every period -- small-cap stocks as a group have produced stronger returns than any other investment category. Mutual funds that invest in this type of stock are known as small-cap funds.

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Small cap stock such as Aberdeen Asset Management (LON: AND) and Samsung Asset management Co are attracting investor attention in Southeast Asia.
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The growth in revenues and earnings of Lucas Energy through acquisition of properties is expected to attract the attention of institutional investors and individual investors seeking to build a quality small cap stock portfolio.
When considering a small cap stock, we look for a high annual growth rate, a market leadership position or special niche in the industry, and a strong management team.
Pink Sheets:AXTG) announced today that it has been invited to the 2007 Small Cap Stock Expo at the American Stock Exchange in New York on February 28, 2007.
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On the other hand, the very high profile and active individual investors should continue to remain cautious, meaning that the small cap stocks in general are likely to underperform for the time being, especially as they tend to underperform larger cap stocks with the onset of recession.
In one of TWST's insightful off-the-record pieces, TWST talks in confidence to leading analysts at brokerage firms about their views of top management in the medical technology: small cap stocks industry, and asks which of those CEOs are doing the best job in maximizing value for their shareholders.