What is Micro Cap?
Market capitalization ranks stocks into a number of distinct groups. Micro cap stocks are in the bottom rank and represent companies whose total market capitalization is less than 50 million US dollars (USD). Some add an even smaller rank called nano cap stocks. Market capitalization is the product of the stock price and the number of stock shares issued, so if XYZ company has issued one million shares and the stock price is 0.30 USD, then its market capitalization is 300 thousand USD and XYZ company is a micro cap company. Its stock shares would be considered micro cap stocks. Micro cap stocks are also sometimes referred to as penny stocks. This micro cap ranking is important when considering an investment in a particular company. Each rank has certain stereotypical features. Micro cap stocks are very risky. Micro cap stocks are the stock shares of companies that are just getting started. The market for micro cap stocks can be very small, and while you can purchase the stock, you may
