The well-known, “blue-chip” companies in these funds generally have market capitalizations above $10 billion. Large-cap stocks typically are considered relatively stable, but with somewhat limited growth potential compared to smaller companies.
Mid-cap companies generally have market caps ranging from approximately $3 billion to $10 billion. They might not be industry leaders – yet – and can sometimes be more volatile than large-caps. However, they have more potential for long-term growth.
Small-cap companies are generally younger companies with market caps of less than $3 billion. Small-caps present the possibility of greater long-term capital appreciation. However, stocks of smaller companies are subject to more abrupt or erratic price movements than larger-company stocks.