micro-cap
UK[ˈmaɪkrəʊˌkæp]US[ˈmaɪkroʊˌkæp]
n
A company with a very small market capitalization, typically below a specific threshold (e.g., $300 million).
adj
Relating to or consisting of such very small companies.
Morpheme Breakdown
micro
cap
micro
extremely small
cap
short for capitalization
Etymology
The term 'micro-cap' is a modern financial compound, formed in the late 20th century as investment categories became more granular. It combines the Greek-derived prefix 'micro-', meaning extremely small, with the clipped form 'cap', an industry shorthand for 'market capitalization'—the total market value of a company's shares. The logic is directly descriptive: a micro-cap company is one whose total market valuation is on the very small end of the spectrum. This term exemplifies the trend in financial jargon to create efficient, hierarchical labels (e.g., mega-cap, large-cap, small-cap, micro-cap) by attaching classical prefixes to a core economic concept rooted in the Latin word for 'head' or 'sum.'
Analysis
Structure: micro (extremely small) + cap (short for capitalization)
- micro: From Greek mikros (small). A combining form meaning "extremely small" or "one millionth."
- cap: A shortening of the word "capitalization." From Latin caput (head), referring to the head or principal sum of money.
Examples
The fund specializes in high-risk, high-reward investments in micro-cap stocks.
Due to their size, micro-cap companies are often more volatile and less liquid than their larger counterparts.
He built a diversified portfolio that included a small allocation to the micro-cap sector.