What Is the Difference Between Large Cap and Small Cap?

Large-cap shares are shares issued by large companies with a total market value of more than 2 billion yuan. The total capital is calculated by multiplying the company's existing shares by the market value of the shares. Large-cap companies are usually shipbuilding, steel, and petrochemical companies. There is no uniform standard for large-cap stocks, and it is generally agreed that stocks with large capital stocks.

Large Cap Stocks

Usually refers to the shares of listed companies with a large amount of outstanding shares outstanding. on the contrary,

Investors who have spent some time in the stock market have almost formed such a concept:

Since the end of 2007, the frequent occurrence of the "two eight" phenomenon in the market operation has been a distinctive feature.

When we analyze carefully

Definition of index

In fact, experienced investors know that small-cap stocks are speculative and large-cap stocks are sluggish. When selecting stocks, investors often fall in love with small-cap stocks.

But the times are different now. Although investors fundamentals seem to have some truth, small-cap stocks have larger growth space, stronger expansion, and are easier to be acquired and restructured. However, China s The so-called large enterprises can only be considered as small and medium-sized enterprises according to international standards, and there is still much room for growth.

In fact, small enterprises (small-cap stocks) have higher operating risks and great uncertainty in the future; while large enterprises (large-cap stocks) have stronger strengths, less operating risks, and more promising prospects. Of course, the most important thing is to see how big companies get bigger. If it has been in the market for many years, it has grown by its own strength. It is an excellent company selected by the market. The successful accumulation of funds, market experience, talents, etc., has a large investment value and low investment risk for the enterprise; if it is a large enterprise relying on the support of government administrative methods to pull out seedlings, it will be like a tired egg, and the future risks are great .

From the operational reality of the capital market, the reason why China s small-cap stocks are well speculated is that most bookmakers have not studied the growth of enterprises. The reason is that the amount of capital required is relatively small, and it can be achieved with a relatively small amount of capital. Holding.

Large market capitalization stocks are particularly suitable for large funds, whether it is collecting chips or distributing, it is relatively easy. Fishes are shallow, while whales are not in the pond and must have a large capacity. ^[1]

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