microcap

microcap

1. Of or relating to the common stock of a company with a small capitalization, usually between $50 million and $250 million. Microcap stocks tend to experience volatile price movements and are subject to investment fraud schemes. In addition, information about the small companies that issue these stocks may be difficult to obtain. Many microcap stocks trade over the counter and are quoted on the OTC Bulletin Board or the Pink Sheets.

2. Of or relating to a mutual fund that holds mostly microcap stocks in its portfolio. Microcap funds tend to exhibit large changes in net asset value.