Apple's market cap, live
Large-cap, mid-cap, and small-cap compared
| Category | Market Cap | Characteristics |
|---|---|---|
| Large-cap | Over $10 billion | Stable, well-researched, lower volatility (e.g., Apple, Microsoft) |
| Mid-cap | $2B - $10B | Established but still growing, often acquisition targets |
| Small-cap | Under $2B | Higher growth potential but higher risk of failure |
Different size cutoffs, and the one we use
Conventions vary. Oxford Ledge uses a 5-tier scheme internally: Mega ≥ $200B, Large $10-200B, Mid $2-10B, Small $300M-$2B, Micro < $300M. MSCI and S&P use slightly different cutoffs. The 3-tier table above is the most common public framing.
Historical returns by company size
Small-caps: higher potential, higher volatility
Small-cap stocks earned higher average returns over the very long 1926-2023 sample, but whether a durable 'small-cap premium' exists is contested: the measured edge concentrates in the smallest stocks and weakens sharply in the decades after it was documented in 1981. (The Size Premium and the Fama-French Alternative module, corpval-17 in the Cost of Capital path, walks through the full controversy.) What is not contested is the volatility: a biotech startup might rise 500% or go to zero. Microsoft is unlikely to do either.
Sort companies by size in the screener
Which size is the likeliest acquisition target?
Why diversifying across sizes balances risk
Which size fits a low-risk, steady goal?
Sit with the ideas.
Which type of company is most likely to double in value over 5 years, but also most likely to go bankrupt?