|Type||Market Cap Range|
|Large-Cap||$10 Billion or More|
|Mid-Cap||$2 Billions to $10 Billion|
|Small-Cap||$300 Million to $2 Billion|
|Micro-Cap||$50 Million to $300 Million|
|Nano-Cap||Less Than $50 Million|
Investing in micro caps
This is why you are here. Most would say microcap stocks are riskier. This is because they are less stable than the bigger cap stocks. Most likely those are held by larger companies. Micro caps trade on the pink sheets. These have lower standards than the NASDAQ and NYSE. You will have less information and the ability to analyze because of this. It can be tougher to properly evaluate their investment compared to buying stocks on margin.
There are some exceptions. Some stocks may be called micro caps based on the overall market value. But they may have super stable profits and trade on well on a major exchange. Here is an example of this, Peoples Financial Services Corp (NASDAQ: PFIS). This is a community bank based in Pennsylvania.
You can trust this because it trades on the NASDAQ, pays a nice dividend, and has a strong history of profitability. Look for history since it will be a great judge of reliability.
Market Cap and Stock Price
The type of stock does not have anything to do with the share price. You will often see Large-Cap stock shares trade for less than $10 per share. Even Micro Cap Stocks can see prices at several hundred dollars per share.
The type of stocks is related to market capitalization. Market Cap is the market value of the companies stock that has not been bought yet. When you go to buy shares or stocks you will see this included. Again, this is the market cap or market capitalization.
If it is not given to you don’t worry. You can calculate the market cap yourself. Just multiply the current price of the stocks by the number of outstanding shares.
The Market Cap will go up and down a lot. This is because it is based on the current share price. The type of share will be put into one of these categories periodically.
Words of caution with Micro Cap Stocks
Although micro caps can make a good long-term investment, it’s important I am honest with you. The regulations are more relaxed compared to the bigger cap stocks. So be cautious when considering which micro cap stocks to buy for your portfolio.
Micro Cap Millionaires Can Help!
There is a lot of knowledge on the web about how to make this work. But I want to introduce you to Micro Cap Millionaires. Here you will learn how to safely buy and sell micro cap shares.
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