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Stocks Beginner:
Small, Mid, and Large-Cap Stocks
Test your knowledge
Choose wisely. There is only one correct answer to each question.
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1.
________ is a characteristic of small-cap stocks.
Choose wisely. There is only one correct answer.
Price volatility
Low earnings
Slow growth
Price volatility. Because small-cap companies may behave unpredictably, their stocks may, too.
2.
Why do growth and aggressive-growth mutual funds include small-cap stocks in their portfolios?
Choose wisely. There is only one correct answer.
Small-cap stocks pay high dividends.
The smaller the stock, the more a fund can include.
Small-cap stocks are growth-oriented.
Small-cap stocks are growth-oriented. As a result, they are very popular in growth-oriented mutual funds.
3.
Large-cap stocks are more likely than small-cap or mid-cap stocks to pay dividends.
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True
False
True. This is partly because they have enough funds to finance future growth. Some of them, however, may have less room to grow.
4.
Mid-cap stocks _______.
Choose wisely. There is only one correct answer.
Pay the highest dividends of any size stock
Represent medium-sized companies
Are the safest of all stocks
Represent medium-sized companies. They are not necessarily the safest, and they usually do not pay the highest dividends of any stock.
5.
If the Zing! Internet stock has a capitalization of $100 million dollars, it is probably a _______ stock.
Choose wisely. There is only one correct answer.
Small-cap
Mid-cap
Large-cap
Small-cap. By most models, this capitalization is quite small.
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