If you take a look at the vast array of mutual funds in which you can put away some money, you will see that they are classified in a dizzying number of ways. Stock funds and bond funds. Growth funds and value funds. Sector funds and balanced funds. Then, there is size.
Mutual funds are also classified according to their size or market capitalization.
During the 2000-2001 market meltdown, you've been hearing that large growth funds were suffering most. You've probably also heard that some small and mid-cap funds were doing better than the big guys. Market cap refers to the worth of a company in the financial markets. You usually calculate market cap by multiplying the number of shares of stock the firm has outstanding by its current market price per share. So, the higher the stock price, the larger the market cap of a firm.