What is the capitalization? What does small capitalization fund or a large capitalization mean?
The capitalization of a company is the value of all of a company’s outstanding shares of stock. It serves as a measure of how big a company is. Capitalization can be calculated by multiplying the number of outstanding shares for a company by the stock’s price. Large-cap stock funds, which invest in the biggest, most stable (blue-chip) companies, tend to be the safest stock mutual funds, while small cap funds invest in smaller, more volatile companies. Smaller companies may offer greater long term potential for growth, if you can tolerate long periods of volatility, or rising and falling share prices.
