What is a Mid Cap Stock?
Market capitalization ranks stocks into a number of distinct groups. Mid cap stocks are in the middle rank and represent companies whose total market capitalization is between 2 billion and 10 billion US dollars (USD). Market capitalization is the product of the stock price and the number of stock shares issued, so if XYZ company has issued one billion shares and the stock price is 3 USD, then its market capitalization is 3 billion USD and XYZ company is a mid cap company. Its stock shares would be considered mid cap stocks. This is important when considering an investment in a particular company. Each rank has certain stereotypical features that you can look for in the mid cap stock under consideration. Mid cap stocks are more risky than large cap stocks and less risky than small cap stocks. Generally, risk of company failure decreases as the company increases in size. However, a mid cap stock also has better potential for growth than a large cap company. A very large company may have
