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A large-cap stock is the stock of a company having a market capitalization over $10 billion (although the criteria for what makes a large-cap stock tends to vary). Large-cap stock is often called blue chip stock; it is the stock of the largest companies, such as IBM, Microsoft, and 3M. Large-cap stock tends not have as much room to grow as small-cap stock and is therefore not as popular among investors seeking growth from a stock. Large-cap stock is more likely than small-cap stock to pay regular dividends, partly owing to its greater net earnings and its stability. Also due to its stability, large-cap stock is popular among risk-averse investors and those seeking to conserve their investment from possible loss. |
