---
title: Small, medium and large cap stocks
description: There are hundreds of different equities to invest in on various exchanges. Some are priced at a few cents per share, others thousands of rands or dollars.
---

[EasyEquities Blog ](https://blogs.easyequities.co.za)

# [Small, medium and large cap stocks](https://blogs.easyequities.co.za/small-medium-and-large-caps)

 Written by [TeamEasy](https://blogs.easyequities.co.za/author/teameasy) | Feb 7, 2019 11:25:00 AM

There are hundreds of different equities to invest in on various exchanges. Some are priced at a few cents per share, others thousands of rands or dollars. All fall into one of three categories: 

 

- Small caps 
- Medium caps   
- Large caps 

The values for determining small, medium and large cap can be vague and differ between countries but as an example, large caps in the US typically have a market capitalization of $10 billion plus and in South Africa our largest 40 companies make up our large caps.

Market cap—or market capitalization—refers to the total value of a company's shares.

The price of a share multiplied by the total number of outstanding shares gives you market cap.

For example:

*A company with 10 million shares selling at R50 a share would have a market cap of R500 million.  *

The market capitalization is often used to make investment decisions as it gives investors an idea of the size of one company versus another company. But is bigger always better? 

- Investing in large-cap companies is thought to provide long-term rewards and less risk, as the companies are well established and stable.  
- Mid-cap companies have great growth potential but are often seen as constrained by track record and resources. 
- Small-cap companies are often considered a high-risk investment choice due to factors like their limited financial resources. However, more than 75% of JSE listed companies fall in this category, so many don’t want to lose out on the opportunities they offer. 

Often shares are over or under-valued based on a variety of factors – some logical, some emotional. Like so much in investing, there are no right or wrong answers. Invest in penny stocks, medium or large caps or a mixture of the three. But make sure you know your risk appetite, have a plan and do your [research](https://research.easyequities.co.za/). 

[View full post](https://blogs.easyequities.co.za/small-medium-and-large-caps)

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