Large-cap Stocks

• The top 100 companies of India by Market Cap are considered large-cap stocks.
• They are usually the stalwarts in their respective industries.
• Large caps are considered conservative equity investments.

They tend to fall lesser during market corrections, but also rise. lesser during strong bull markets.

• Some examples: Reliance Industries, TCS, HDFC Bank, Infosys, Hindustan Unilever.

When to buy LARGE-CAP stocks?

All-weather stocks. Can be bought at all times, considering investment horizon is long term.

Mid-cap Stocks

• 101st to 250th company of India by Market Cap are considered as mid-cap stocks.
• These are competitors to large caps or stalwarts in growing industries.
• They are considered moderate risk equity investments. They are more risky than large caps but less risky than small caps.
• Some examples: Tata Power, Exide, SAIL, TVS Motor.

When to buy MID-CAP stocks?

Mid cap stocks should be avoided during the market euphoria. They can be bought at all other times.

Small-cap Stocks

• Beyond 251st company by market cap are considered as small-cap stocks.
• These can be anything from big companies in upcoming industries to small companies in established sectors to companies in declining industries etc.
• They are considered high-risk equity investments. They generally fall the highest during market corrections, but can also give supernormal returns during market recovery.
• Examples: PVR, Blue Star, IEX, Trident, CDSL.

When to buy SMALL-CAP stocks?

Small cap stocks should be bought during times of economic recovery and when market prices are depressed.

DISCLAIMER: This blog is solely for educational purposes and not to offer any investment advice. Please do your own research or consult a financial advisor before making any investment decisions.