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Finance GlossaryMid-Cap
Mid-Cap
Definition of Mid-Cap
Mid-Cap companies are those ranked 101 to 250 by market capitalisation in the overall market. They are generally larger and more stable than small-cap companies while still offering higher growth potential than large-cap stocks. Mid-cap stocks often appeal to investors seeking a balance between growth opportunities and risk.
Related Terms
Margin Call
Margin call occurs when a brokerage firm requires the investor to deposit funds in their account or sell their securities in order to meet the minimum margin requirement in their account because the value of their leveraged investments has dropped below a required level. If market participants fail to do so, the broker forcibly closes the position to protect their loaned funds.
Acceptance Credit
Acceptance Credit is a way for buyers to authorize fund transfers to sellers at a specific date when various terms & conditions are met.
This is done through a letter of credit which is a creditworthy bank’s promise that the payment will be made.
There are two types of Acceptance Credit:
This is done through a letter of credit which is a creditworthy bank’s promise that the payment will be made.
There are two types of Acceptance Credit:
- Confirmed: Bank guarantees payment in case the buyer defaults
- Unconfirmed: Bank does not guarantee payment in case the buyer defaults
Best Efforts Underwriting/Offering
A best efforts underwriting or offering means the underwriter will do their best to market the securities for the issuer (company, supplier, etc) to investors. The underwriter will not buy all the securities from the issuer, only those the underwriter’s clients want to purchase.
Basing
Basing happens when a security trades sideways after prolonged periods of falling prices.
As a result, the security forms a “base” or flat pattern which means there is little to no upward or downward movement and a decline in volatility.
This may go on for a relatively long time but is crucial as basing is an indicator of any meaningful reversal that may happen.
As a result, the security forms a “base” or flat pattern which means there is little to no upward or downward movement and a decline in volatility.
This may go on for a relatively long time but is crucial as basing is an indicator of any meaningful reversal that may happen.
Quantitative Analysis
Quantitative analysis (QA) is the application of mathematical and statistical modeling, measurement, and research to understand and predict behavior in the financial markets. Quantitative analysts use complex mathematical models and algorithms to analyse trading opportunities, manage risk, and execute trades using large amounts of historical data and computational power, rather than qualitative factors such as management experience and company reputation.
Beta Stocks
Beta of stocks measures the risk that the shares carry compared to the broader market. Theoretically, the market is said to have a default Beta of 1. As a result, Beta stocks can be of four types:
- High Beta Stocks : typically having a Beta value of more than 1, these stocks are known to be high-risk, high-reward investments
- Low Beta Stocks : typically having a Beta value of less than 1, these stocks are known to be low-risk, low-reward investments
- Negative Beta Stocks : typically having a Beta value of less than zero, these stocks are known to have an inverse correlation with the market
- Same as the market : typically having a Beta that’s equal to 1, these stocks are known to share characteristics with the market
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