Mid-Cap Stock

Companies are commonly grouped by size, measured by market capitalization, the share price multiplied by the number of shares. Mid-cap companies sit in the middle of this range. The exact boundaries vary between markets and index providers and change over time as markets grow.

Mid-cap companies are often established businesses that have moved beyond the start-up stage but still have room to grow. Many are leaders in specialized niches or regional markets.

For example, a mid-cap company might be a manufacturer of specialist industrial equipment with a strong position in its niche and plans to expand internationally.

Mid-caps are often seen as offering a balance between the growth potential of small companies and the stability of large ones. They are generally more volatile than large-caps but less so than small-caps, and their shares are usually reasonably liquid. Many investors hold mid-caps through funds tracking mid-cap indices, as part of a diversified portfolio.