What Are Large, Mid, and Small-Cap?

Three photos. On the left is a skyscraper office building with "Large Cap" above it. It in the middle is a small grocery store with the word "Mid Cap" above it. On the right is a small restaurant with "Small Cap" above it.

Capitalization

“Cap” is short for capitalization. Market capitalization is essentially what a publicly traded company is worth.

According to the Financial Industry Regulatory Authority (FINRA):

Market capitalization, or market cap, is one measurement of a company’s size. It’s the total value of a company’s outstanding shares of stock…

To calculate market cap, you take the total number of a company’s shares outstanding and multiply that figure by the company’s current share price.

For example, if a company has 5 million shares outstanding and its current stock price is $20, it has a market capitalization of $100 million.

Market capitalization = shares outstanding * stock price

$100 million = 5 million shares * $20 per share

Large, Mid, and Small-Cap in Theory vs. Practice

According to FINRA, the definitions of large, mid, and small-cap are

  • large-cap: market value of $10 billion or more

  • mid-cap: market value between $2 billion and $10 billion

  • small-cap: market value of less than $2 billion

However, what matters to investors is the size of companies in large-cap, mid-cap, and small-cap funds. Those categories aren’t as clear.

Large-Cap

A couple practical sources for the large-cap stocks are:

Largest Vanguard Large-Cap

The largest holdings for the Vanguard Large-Cap Exchange-Traded Fund (ETF) are:

Title: "Top 10 Vanguard Large-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are Microsoft, Apple, and NVIDIA.

Largest Fidelity Large Cap

The largest holdings of the Fidelity® Large Cap Stock Fund are similar but notably different:

Title: "Top 10 Fidelity Large-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are Microsoft, Exxon Mobil, and Wells Fargo.

Comparison of the Largest Vanguard and Fidelity Large-Cap

Half of the 10 largest holdings are the same for the two large-cap funds:

  • Microsoft Corp.

  • Apple Inc.

  • NVIDIA Corp.

  • Meta Platforms Inc.

  • Alphabet Inc.

The others are different.

Title: "Top 10 Large-Cap" on top. It's a Venn diagram with Vanguard in maroon on the left and Fidelity in green on the right. The intersection includes: Microsoft, Apple, NVIDIA, Meta, and Alphabet.

Smaller Vanguard Large-Cap

The smallest Vanguard Large-Cap ETF companies are about 1/1,000th to 1/100th the size of the largest:

Title: "Bottom 10 Vanguard Large-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are Liberty Media., Siruis XM, and Zillow.

Mid-Cap

Two practical sources for mid-cap stocks are:

Although they’re huge, fewer mid-cap companies are household names.

Largest Vanguard Mid-Cap

The largest Vanguard Mid-Cap Index Fund holdings have market capitalizations several times the $10 billion upper FINRA limit:

Title: "Top 10 Vanguard Mid-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are Amphenol, TransDigm, and Constellation Energy.

Largest Fidelity Mid-Cap

The largest Fidelity® Mid Cap Index Fund holdings are closer in size to the largest Vanguard Mid-Cap holdings than the $10 billion upper FINRA limit:

Title: "Top 10 Fidelity Mid-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are CrowdStrike, Amphenol, and Trane.

Comparison of the Largest Vanguard and Fidelity Mid-Cap

Four of the top 10 holdings are the same for the two mid-cap funds:

  • Amphenol Corp.

  • TransDigm Group Inc.

  • Constellation Energy Corp.

  • Cintas Corp.

The rest are different.

Title: "Top 10 Mid-Cap" on top. It's a Venn diagram with Vanguard in maroon on the left and Fidelity in green on the right. The intersection includes: Amphenol, TransDigm, Constellation Energy, and Cintas.

Smallest Vanguard Mid-Cap

Many of the smallest Vanguard Mid-Cap Index holdings are much bigger than FINRA’s mid-cap range of $2 to $10 billion:

Title: "Bottom 10 Vanguard Mid-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are Paramount Global, Liberty Media, and Liberty Broadband.

Small-Cap

The largest companies held in Vanguard and Fidelity small-cap funds are several times larger than FINRA's $10B upper limit for mid-cap stocks.

Largest Vanguard Small-Cap

The largest holdings in the Vanguard Small-Cap Index Fund are:

Title: "Top 10 Vanguard Small-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are Deckers Outdoor, Targa Resources, and MicroStrategy.

Largest Fidelity Small-Cap

The largest holdings in the Fidelity® Small Cap Index Fund are:

Title: "Top 10 Fidelity Small-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are Super Micro Computer, MicroStrategy, and Carvana.

Comparison of the Largest Vanguard and Fidelity Small-Cap

Only one company is in the top 10 holdings for both small-cap funds:
MicroStrategy Inc.

The others are different.

Title: "Top 10 Small-Cap" on top. It's a Venn diagram with Vanguard in maroon on the left and Fidelity in green on the right. The intersection includes only MicroStrategy.

Smaller Vanguard Small-Cap

Even some of the smallest holdings in the Vanguard Small-Cap Index Fund are larger than the $2 billion small-cap limit:

Title: "Bottom 10 Vanguard Small-Cap" on top. The table includes the symbol, name, and market cap for ten companies. Included are Paramount Global, Nevro, and fuboTV.

Broad Ranges

Neither Vanguard nor Fidelity follows the FINRA definitions of

  • large-cap: market value of $10 billion or more

  • mid-cap: market value between $2 billion and $10 billion

  • small-cap: market value of less than $2 billion

Unlike FINRA’s definition, the Vanguard:

  • upper limits for mid-cap and small-cap are several times larger and

  • its ranges overlap.

Title: "Market Cap Ranges" on top. Large-Cap FINRA $10B to $3.5T; Vanguard $4B to $3.5T. Mid-Cap FINRA $2B to $10B, Vanguard $4B to $84B. Small-Cap FINRA < $2B, Vanguard < $30B.

Household Names

It may be helpful to consider household names in each group. The following are examples from the Vanguard funds:

Title "Company Size." Three lists of 10 companies from Vanguard. Large-Cap includes Microsoft, Apple, NVIDIA. Mid-Cap includes Motorola, Cintas, Moderna. Small-Cap includes Deckers Outdoor, Williams-Sonoma, Owens Corning.

Sources

The list of companies held in Vanguard and Fidelity funds come from the following.

Large Cap

Mid-Cap:

Small-Cap:

The market capitalization information for this article come the MarketWatch Investing stock pages for each company such as: Microsoft Corp.


I hope this helps!

If you’re interested in a review of your specific situation…

Disclaimer

In addition to the usual disclaimers, neither this post nor these images include any financial, tax, or legal advice.

Kevin Estes | Founder | Scaled Finance

Kevin Estes is a financial planner helping T-Mobile employees and their families live their best lives.

He worked in T-Mobile Financial Planning & Analysis for nine years and has extensive experience with T-Mobile’s compensation and benefits package. He received a certificate in financial planning from Boston University, passed the CERTIFIED FINANCIAL PLANNER™ exam, and founded Scaled Financed in 2022.

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https://www.scaledfinance.com/
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