Unlock the Power of Mega-Cap Names: Exploring Market Cap Dominance

Market cap has become a widely accepted metric used to measure the size of a publicly traded company, giving investors an indication of just how large it is and potentially how much far it can go. The cap is determined by multiplying the current market price by the total number of outstanding shares. When it comes to the biggest players in the stock market, the term “mega cap” applies. A “mega cap” typically applies to companies worth an excess of $200 billion. The term “large cap” applies to companies worth over $10 billion. There are gigantic companies, such as Apple, Microsoft, Amazon, Google, and Facebook, which approached and even exceeded the $1 trillion market cap benchmark during the peak of the bull market. Over one third of the stock exchange market value is currently dominated by mega cap stocks. Those who invest in mega caps capitalize on the fact that larger companies have the resources to be the most stable during times of economic downturns and during volatile markets. Mega cap stocks are also prime targets for investors due to their brand name recognition and their ability to dictate market prices. Many times, any movement in a mega cap’s stock will have a profound effect on the market’s as a whole. Mega cap stock prices will often move in ivine with many sector and industry specific prices, as their inflation or deflation can set industry trends for many years. It’s no surprise that a company’s brand and cash flow can make miracles happen. As the size of the company gets larger, the company usually has the skillset, resources, and presence to acquire and merge with smaller enterprises and corporations. This allows them to form a larger entity and also increase their market share. For example, Apple’s recent acquisition of Shazam is a great example of the potential increase of its investing power as a mega cap company. Shazam is a popular music and mobile streaming platform, allowing Apple to penetrate into the music, entertainment, and streaming market. Mega cap companies are also most likely to be the leaders in new technologies and services, making them likely favorites for long-term investments. Comedian, early-stage investor, and business magnate, Steve Harvey, has said “invest in mega cap companies that will still be around long after you are gone”. Clearly, the larger the company, the more power it has. The advantages afforded to companies on the list of mega cap names are unprecedented. The ability to dominate in the stock market and their heightened stability during times of market volatility give investors much to look forward to. For those looking to squeeze out the most from their investments, mega-cap names may be the perfect choice.