Market Capitalization of a company is defined as the market price of one equity share of the company multiplied by the total number of equity shares issued by the company.
Large Caps are companies with market valuation of Rs 25,000 crore or more. Mid-Caps are companies with market valuation of up to Rs 25,000 crore. Small Caps are companies with market valuation of Rs 10,000 crore or less.
There is another way of segregating Large Cap, Mid Cap and Small Cap companies. The companies which contribute to the first 70% of the total Market Capitalization are called Large Caps. The companies which contribute the next 20% of the total Market Capitalization are called Mid-Caps. The Companies which belong to the bottom 10% of Market Capitalization are called Small Caps.
Large cap companies are quiet stable and their stock price does not appreciate or depreciate drastically during bull or bear rallies or stable market conditions. Mid cap and Small cap companies are highly volatile and their stock price can appreciate or depreciate drastically. They can give extremely high returns during short durations at the same time you may end up with heavy losses in a short time. Hence they are quiet risky.
Mungekar Wealth 