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Mid-cap

Companies worth roughly $2 billion to $10 billion; more growth runway than large-caps and more volatility, with thinner coverage.

Mid-caps sit in the useful middle: big enough to have real businesses, index membership, and borrowable stock, but small enough that a single product line or contract matters. Analyst coverage thins out here, which is where diligence can still pay.

Volatility is a step up. Daily ranges of 3% to 5% are ordinary, and gap moves after earnings of 10% or more are common, so position sizing has to shrink accordingly.

Example: a $5B company with 100M shares at $50 trading 800,000 shares a day turns over $40M. A 20,000-share order is 2.5% of daily volume and can move the price, so it needs working rather than a single market order.

Related: large-cap, small-cap, market-cap, position-sizing

See it drawn

Original diagrams for the ideas on this page. Illustrative, not real market data.

How a position size is worked outAccount size, risk per trade and stop distance feed into one box giving the number of shares.ACCOUNT SIZE$25,000your capitalRISK PER TRADE1%of the accountSTOP DISTANCE$0.50entry to stopPOSITION SIZE500 sharesrisk budget: $25,000 × 1% = $250position size: $250 ÷ $0.50 = 500 shares
Working out a position size. Three numbers decide how big a trade is: the account, the share of it put at risk, and the distance from entry to stop. One percent of $25,000 is a $250 budget, and a $0.50 stop divides into that 500 times.

Educational only, not advice. Spotted an error? Post in Site Feedback.