Small cap or large cap, how to choose?

Mondo Finance Updated on 2024-03-04

**Shares, usually refers to the ** of listed companies with large circulation; Small-cap stocks refer to listed companies with smaller floats. Many investors should have thought about whether it is better to choose ** stocks or small cap stocks when trading.

Whether it is better to buy small-cap stocks or ** stocks needs to be chosen according to the investor's investment style. From the perspective of stability, because the first share capital is large, the turnover rate is low, and most of the positions are institutions, so it is relatively more stable. Small-cap stocks, on the other hand, have high turnover rates, resulting in large stock price fluctuations and lack of stability.

From the perspective of growth, because small-cap stocks have fewer chips, they are easier to concentrate, and once the concentration is high, it is very easy to form a joint force, so once they can catch a wave of the main rising wave, they often attract more followers, and the increase will be greater. However, unless there is a very significant macro policy support, there will be no short-term surge.

After comprehensive consideration of all aspects, it can be concluded that the first stock plate is relatively large, there are many circulating chips, it is sustainable and stable, and it takes a long time to pull up, which is suitable for medium and long-term investors. The small-cap stocks are smaller, the circulating chips are few, and the dealer is easy to control, once the dealer controls the plate, the market will rise sharply in a short period of time, which is suitable for investors with limited funds and like to operate.

In short, all in all, no matter how you choose between stocks and small-cap stocks, the risk of stocks is always proportional to the expected returns, and investors should make rational investment decisions according to their investment preferences and the amount of funds. ** Changeable, full of opportunities and full of challenges, for investors, should be cautious investment.

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