MID CAP STOCKS AND MUTUAL FUNDS
Grab mid cap stocks before the market realizes their growth potential. Then practice what you've learned with our free stock market simulation.
MID CAP STOCKS LIST
|RRD||R.R. Donneley & Sons|
|ANV||Allied Nevada Gold|
WHAT ARE MID CAP STOCKS?
To be considered a mid cap stock, a company’s total shares multiplied by their current market share price should fall between $2 and $10 million. This will be their market cap. Mid cap companies are smaller in stature than their blue-chip counterparts but, if picked correctly, could be great growth stocks and yield high profits. Mid cap stocks are an important component of a properly diversified financial portfolio. They respond faster to changes and innovations in the market because they tend to be more specialized and focused on their own niche.
Investing in smaller companies carries additional risk, but, because of their extreme potential for growth, can seriously pay off. If you can get in on the ground floor of a great company before they make it big, you stand to make a huge return on your investment. However, it can be hard to predict greatness with so many start-ups to choose from today. A happy medium exists for some in the middle range, as moderately sized companies are more established but generally have lower growth prospects. These companies have been around at least a few years and they have a longer track record. It is a bit easier to predict whether or not these companies are going to make it big in the long run, so the risk is smaller and the return not as lucrative. When it comes down to it, smaller competitors who can change dynamically to meet market demands can outperform large companies.
FINDING THE BEST MID CAP STOCKS TO BUY
Investors looking to build their portfolio of high quality mid cap stocks should be paying attention to both growth and valuation.
The most important thing to tick off the checklist when hunting for mid cap stocks is potential for growth. The target company that you choose should have the ability to grow faster than its larger peers in the industry (thus gaining market share)
The company should be a relatively undiscovered stock and therefore come with a cheaper valuation. Find mid-caps that have low leverage and higher growth profiles that the market has not yet realized.
MID CAP MUTUAL FUNDS
A mid-cap mutual fund is a type of stock fund that invests in companies with mid-sized firms generally ranging from $2 billion to $10 billion in market cap. Most stocks held in a mid cap fund are firms with established businesses – so not exactly small cap – but that are still considered developing companies. These funds arguably present the best of both worlds, as they tend to offer more growth than large cap stocks and less volatility than the small caps.
WALL STREET SURVIVOR'S BEST OF THE BEST LIST
*** April 23rd, 2020 ALERT—Motley Fool Picks Still Doing Well!****The Motley Fool Stock Advisor’s stocks picks, even with this COVID crisis, have been performing very well as of late. Here are some of their most recent picks and their performance:
- Shopify (SHOP) – April 2, 2020 pick and it is already up 70.5%
- Zoom Video (ZM) – March 19, 2020 pick and it is already up 21.2%
- DexCom (DXCM) picked Feb 20, 2020 right before the market crashed and it is still up 7%
- Tesla (TSLA) picked January 2, 2020 before the crash and it is up 75% compared to the SP500 -11% so it is ahead of the market by 86%
- HubSpot (HUBS) picked December 5, 2019 and it is down 5%
- Netflix (NFLX) picked November 21, 2019 and it is up 36%
- Trade Desk (TTD) picked November 11, 2019 and up 19%
- SolarEdge (SEDG) picked September 19, 2019 and it is up 10%
- Zoom was also picked October 3, 2019 and it is up 95% since then.
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(before it's too late)