Small cap company
Shares offered by a relatively small company in terms of value
A small cap company is a company whose market capitalization (shares x value of each share) is considered small. In the United States, this includes market caps from $250 million to $2 billion (as of 2022).
01Overview
A small cap company typically has under $2 billion market cap. Small companies generally are not able to secure the best (prime) borrowing rates and wield reduced power, including a smaller market share. Being small, they are also less financially stable than larger companies, and are more likely to become bankrupt. However, they do generally have more growth potential and over time have greater but more volatile expected returns.
Sources and credits
This article is adapted from the Wikipedia article “Small cap company”, written by its contributors and licensed under CC BY-SA 4.0. Fathomly has changed the layout, removed citation markers, navigation and maintenance notices, and adjusted punctuation. This adapted version is shared under the same license. For references, see the original article.
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