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The "traditional" asset classes are stocks, bonds, and cash: . Stocks: value, dividend, growth, or sector-specific (or a "blend" of any two or more of the preceding); large-cap versus mid-cap, small-cap or micro-cap; domestic, foreign (developed), emerging or frontier markets
Just like gamblers place bets on boxers who fight in divisions based on their weight, investors, too, put their money down on stocks that are grouped together by size. All publicly traded companies...
For example, if a company has 4 million common shares outstanding and the closing price per share is $20, its market capitalization is then $80 million. If the closing price per share rises to $21, the market cap becomes $84 million. If it drops to $19 per share, the market cap falls to $76 million.
Asset classes and asset class categories are often mixed together. In other words, describing large-cap stocks or short-term bonds as asset classes is incorrect. These investment vehicles are asset class categories, and are used for diversification purposes. Multiple asset classes mixed together in a fund structure can provide an investor with ...
Large-cap stocks are generally considered to be safer investments than their mid- and small-cap stock counterparts because they are larger, more established companies with a proven track record.
Bonds broadly fall into two large categories based on their rating: Investment-grade bonds: Investment-grade bonds are viewed as good to excellent credit risks with a low risk of default. Top ...
Stocks can be split into categories such as small-cap, mid-cap, large-cap, value, defensive, cyclical, growth, international, regional, technology stocks, utility stocks, old economy or new economy, disruptive innovation, and so on. Classification of securities into categories is widespread in the financial field applying to other asset classes ...
Generally, a value stock is one that trades at a price lower than its fundamental value or what the company's performance suggests it should be worth. Typically, these are shares of a company with ...