Though the majority of stocks are actually found in smaller caps, large cap stocks are better known and thus hog most Wall Street’s attention. Then practice what you’ve learned with our free stock market simulation.
LARGE CAP STOCKS LIST
Take a look at these big kahuna stocks recommended by Nasdaq:
|CARR||Carrier Global Corporation|
|COF||Capital One Financial Corporation|
|GS||Goldman Sachs Group Inc.|
|TRI||Thomson Reuters Corp|
LARGE CAP MUTUAL FUNDS LIST
Here are some of the best large-cap mutual funds according to TheStreet:
|USNQX||USAA Mutual Fds Tr Nasdaq 100 Index Fund|
|PBLAX||Principal Funds Inc. Blue Chip Fund|
|CLSUX||ClearBridge Sustainability Leaders Fund|
|MGNDX||Praxis Growth Index Fund – Cl A|
WHAT ARE LARGE CAP STOCKS?
Large cap refers to large market capitalization. “Large Cap” is a term used by the investment community. Cap size has changed over time, so it’s important to take scaling into consideration. What was considered a big cap stock thirty years ago is very much a small cap stock today. Commonly referred to as blue chip stocks, the largest publicly traded companies have a cap of $10 billion or greater. They’re usually the best-known companies traded in the public market (Apple, Walmart, Facebook etc). Wall Street’s attention is concentrated heavily on these giants because it’s where the lucrative investment banking business resides – but the majority of stocks are actually found in the smaller (and riskier) caps.
Fun fact: AAPL recently shattered records by hitting a market cap of $775 billion!
WHAT ARE LARGE CAP MUTUAL FUNDS?
Large cap funds consist of companies with market caps of $8 billion or more. Mutual funds actually have restrictions on the level of ownership they can have in any one company (generally no more than 10% of their outstanding shares), so oftentimes these funds are forced to imitate a larger index. This usually forces the big cap funds to purchase large companies – the same companies that make up the major market indexes. There are lots of large cap income funds that are awesome for risk-averse investors. Investors with large time horizons tend to rely on more passive investing strategies. Large cap mutual funds would be appealing to these guys, as they usually aim to buy and hold. When picking between a small, medium or large cap mutual fund, make sure to take into consideration not only its size but also in which investing style the fund specializes.
FINDING THE BEST LARGE CAP STOCKS TO BUY
Blue chip stocks should be a part of any properly diversified portfolio. Many think that these massive stocks are too conservative, but they still see incredible amounts of trading and speculation on a daily basis. Even these huge companies see price fluctuations that cause investors to panic or cash out. Here are the main reasons why you want to get your hands on some large cap stocks:
Their size makes big cap companies relatively stable compared to smaller caps. They’re much less likely to go under, but their growth rate is sluggish in comparison. These companies are typically market leaders, so while it’s difficult for them to grow as quickly as up-and-comers, they are the much safer investment.
Large cap stock companies are much more likely to pay dividends. They know the stock price isn’t likely to appreciate in value as quickly as a growth company’s. Big cap companies are super profitable, yes. But they simply don’t have the same opportunity to grow. Their stock price remains relatively stagnant, so they pay back dividends in order to compensate their investors.
During the inevitable downturn in the business cycle is when large cap companies are extra hot. These whales aren’t necessarily immune to recessions, but they’re certainly more stable in the face of one. Dividend payments are also an attractive source of income when bond yields are low.
BEST STOCK NEWSLETTER
The Motley Fool Stock Advisor has won our Award for the Best Stock Newsletter for the last 5 years.
We have been tracking ALL of the Motley Fool stock picks since January 2016. That's over 5 years and over 120 stock picks. As of Friday, December 31 2021, 19 of their 24 stocks picks from 2020 are up and the average return is 106% compared to the SP500's 50%. Take a look at some other FACTS about their service:
- The average return of their 24 picks from 2019 is up 108% compared to market's 68%; and 20 of those 24 are profitable
- Of their 24 stock picks from 2018, 20 are up, the average return is 248%, and 11 have more than doubled in price
- From 2017, all 24 of their stock picks are up, 12 have more than doubled and the average return is 254%
- And from 2016, 20 of 24 are up, 17 have more than doubled and the average is an amazing 451% ( thanks in part to them picking SHOP)
- So the point is that not every one of their picks goes up, but the longer you hold them, the better they have performed, at least since 2016
- Tesla (TSLA) picked January 2, 2020 before the crash and it is up 1,320%
TIP FROM THE AUTHOR: If your portfolio is not up 233% over the last 5 years with 84% profitable trades, then you are investing missing out on big profits. Be pro-active and buy stock tips from this trusted source instead of being re-active and buying stocks that everyone else is buying! A subscription to the Fool will probably be the best investment you ever make. They already have over 1,000,000 subscribers.
Normally the Fool service is priced at $199 per year but they are currently offering the next 12 months for just $79 on THIS NEW SUBSCRIBER PAGE.
WANT THE BEST STOCKS? SAVE $120 on the MOTLEY FOOL and GET NEXT 12 MONTHS OF THEIR PICKS FOR ONLY $79.
GET UP TO $1,000 IN FREE STOCK
WHEN YOU OPEN A ROBINHOOD BROKERAGE ACCOUNT
Robinhood was the first brokerage site to NOT charge commissions when they opened in 2013. They just past 10,000,000 accounts and to celebrate they are offering up to $1,000 in free stock when you open a new account.
Here's the details: You must click on a special promo link to open your new Robinhood account. Then when you fund your account with at least $10, you will receive one stock valued between $5 and $200. Then, you will get a link to share with your friends. Every time one of your friends opens an account, you will receive another free stock valued between $5 and $200. Click here to learn more about this Special Robinhood offer.
(before it's too late)