Stocks Beginner: Small, Mid, and Large-Cap Stocks

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1.
The XYZ Hi-Technology company is four years old and already has a market value of one billion dollars. Its stock is therefore large-cap.
Choose wisely. There is only one correct answer.
False. Large-cap stocks are the stocks of large, established companies. This hypothetical company does not fit that definition.
2.
If the Zing! Internet stock has a capitalization of $100 million dollars, it is probably a _______ stock.
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Small-cap. By most models, this capitalization is quite small.
3.
Why do growth and aggressive-growth mutual funds include small-cap stocks in their portfolios?
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Small-cap stocks are growth-oriented. As a result, they are very popular in growth-oriented mutual funds.
4.
A medium-sized stock with a good growth record and the potential of becoming a large-cap stock is called a _______.
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Baby blue chip. In other words, the issuer is likely to become a blue chip company.
5.
________ is a characteristic of small-cap stocks.
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Price volatility. Because small-cap companies may behave unpredictably, their stocks may, too.