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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The TSP offers several different investment funds: Government Securities Investment ("G" Fund); Fixed Income Index Investment ("F" Fund); Common Stock Index Investment ("C" Fund); Small Capitalization Stock Index Investment ("S" Fund), and International Stock Index Investment ("I" Fund).
of San Francisco, California, has been selected to manage the Common Stock Index Investment (C) Fund, the Small Capitalization Stock Index Investment (S) Fund, the International Stock Index Investment (I) Fund, and the Fixed Income Index Investment (F) Fund of the Thrift Savings Plan (TSP) for Federal employees.
The Russell 2000(R) Index is the most widely followed benchmark of small capitalization stock market performance.
The firm's team of international small capitalization stock specialists is based in London.
Panel A of Table 4, representing large capitalization stocks, shows t-statistics of market capitalization differences (from the beginning to the end of the reference periods) predominately significant in relation to the t-statistics in Panel B representing small capitalization stocks.
DXJS is designed to provide exposure to small capitalization stocks within Japanese equity markets while hedging exposure to the yen.
Based on these observations, the Fama French Three Factor Model asserts that the expected return on a portfolio in excess of the risk free rate is explained by the sensitivity of its return to three factors: (1) the excess return on a broad market portfolio, (2) the difference between the return on a portfolio of small capitalization stocks, and (3) the return on a portfolio of big capitalization stocks and the difference between the return on a portfolio of high book to market ratio stocks and the return on a portfolio of low book to market ratio stocks, thus adding two new factors: the firm size and the value effect.
When the investors expect that the economy will expand rapidly, the small capitalization stocks will have, on average, better returns than large capitalization stocks.
Among her reasons are that more attention should be paid to the entire market portfolio including small capitalization stocks.
We suggest that small capitalization stocks have several inherent characteristics that at least temporarily distinguish them from medium and large capitalization stocks.
Mutual funds holding small capitalization stocks (companies valued between 50 million and $1 billion) peaked in 1983 and then stayed in the doldrums for eight years.
In what should be good news for investors in chain drug stocks, which tend to be classified as small growth companies, investment analysts feel that many large institutional investors are beginning to buy small capitalization stocks with superior prospects for the first time in a number of years.