List of microcap stocks in india

Posted by Sovrenn

Finance & Investment

Jan 18, 2024

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What is a microcap stock

Over 5,000 companies are listed on the BSE, and over 2,000 on the NSE. SEBI categorises the top 100 companies as large-cap stocks by market capitalization. Companies ranked 101st to 250th are mid-caps, and those ranked 251st and beyond are small-caps. Micro cap stocks are typically market cap of less than Rs 5,000 crore.

Which is more safe stocks ? mid cap, small cap, large cap, micro cap

1- Large-Cap Stocks

Large-cap stocks belong to companies with a large market capitalization, typically over $10 billion.

Safety: Large-cap stocks are often considered more stable and less risky than smaller-cap stocks. These companies are usually well-established, have a proven track record, and are less susceptible to market volatility.

Mid-Cap Stocks:

Mid-cap stocks belong to companies with a market capitalization between $2 billion and $10 billion.

Safety: Mid-cap stocks are considered to have a moderate level of risk. They may offer more growth potential than large caps but can also be more volatile. These companies are usually in a phase of expansion and may have more room for growth compared to large caps.

Small-Cap Stocks:

Small-cap stocks belong to companies with a market capitalization between $300 million and $2 billion.

Safety: Small-cap stocks are riskier than large and mid-cap stocks. They might grow more but are also more likely to be affected by economic problems and market changes. People who invest in small-cap stocks should be ready for bigger price changes.

Micro-Cap Stocks:

Definition: Micro-cap stocks belong to companies with a market capitalization below $300 million.

Safety: Micro-cap stocks are the most risky type. They usually belong to smaller, newer companies more likely to be affected by economic problems and market changes. It would help if you were willing to take on more risk and do thorough research to invest in micro-cap stocks.

Also Read: Cap Sizes Matter in stocks market: Understand Large Cap, Mid Cap & Small Cap

Safety Considerations:

Diversification: Regardless of market capitalization, spreading investments across different sectors and asset classes can help manage risk.

Investment Goals and Horizon: Your investment goals and time horizon are crucial factors. If you have a longer time horizon and can tolerate higher volatility, you might consider a mix of mid and small-cap stocks for potential higher returns.

Research and Due Diligence: Before investing in any stocks, it's essential to research the companies thoroughly. Understand their financial health, business models, and growth prospects.