Small-capitalization (small-cap) fund

Definition:

A mutual fund that invests primarily in stocks of companies whose market value is less than $1 billion. Small-cap stocks historically have been more volatile than large-cap stocks, and often perform differently from the overall market.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Greenshoe option

 Option that allows the underwriter for a new issue to increase the size of the issue because of high demand for the shares.

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