Gary Halbert · whole document (80)
zflk blitzkrieg paradigm
The first of the next hurdles is volume. If a
stock has a very thin daily volume, just the fact you invest
in that stock will make it skyrocket in price.
Conversely, if the daily volume is too
high, way too much of a mountain of money has to be moved to
effectuate a 50% or more jump in price. Don't make the mistake
of thinking all low-priced stocks represent shares of tiny,
small companies. That's not true at all. On Wall Street, a
company's size is determined by its capitalization. If you
take 100% of all of the shares of stock in a given company,
and then multiply the number of those shares by the price of
each of those shares, the number you come up with will be the
"capitalization"... or... the stock market's opinion
of the financial worth of that company. For example: If a
company's shares are currently selling for $2.50 each and, the
company has a total issue of 20,000,000 shares, that company
has a total capitalization of FIFTY MILLION DOLLARS!
Hey, that doesn't sound like such a small
company, does it?
WRONG! At least, according to the stock
market. As far as Wall Street is concerned, a company worth
$50,000,000 or less is..
A "Micro" Cap
Moving up from 50 million to 200 million, we
have a group of companies, each of which is considered...
A "Small" Cap
Ain't that something? A company worth as much
as 200 million
fungolas is still only "small potatoes" as far as
Wall Street is concerned.
Moving right on up the ladder, we have those
companies worth somewhere between 200 million and 1.5 BILLION!
Think that puts it at the top of the pile? Not a chance. If a
company is only worth a measly 1.5 billion
($1,500,000,000.00!) it is still only considered...
A "Mid" Cap
You wanna run with the big dogs? Want to be
considered a serious
company? Well, as long as your company is worth more than 1.5
billion, you are then considered...
A "Large" Cap
Get this: Some of these companies are so damn
big, the daily trading
volume of their shares is 2-1/2 billion
dollars or more!