The top 100 companies of India by Market Cap are considered large-cap stocks.
They are usually the stalwarts in their respective industries.
Large caps are considered conservative equity investments.
They tend to fall lesser during market corrections, but also rise. lesser during strong bull markets.
Some examples: Reliance Industries, TCS, HDFC Bank, Infosys, Hindustan Unilever.
When to buy LARGE-CAP stocks?
All-weather stocks. Can be bought at all times, considering investment horizon is long term.
101st to 250th company of India by Market Cap are considered as mid-cap stocks.
These are competitors to large caps or stalwarts in growing industries.
They are considered moderate risk equity investments. They are more risky than large caps but less risky than small caps.
Some examples: Tata Power, Exide, SAIL, TVS Motor.
When to buy MID-CAP stocks?
Mid cap stocks should be avoided during the market euphoria. They can be bought at all other times.
Beyond 251st company by market cap are considered as small-cap stocks.
These can be anything from big companies in upcoming industries to small companies in established sectors to companies in declining industries etc.
They are considered high-risk equity investments. They generally fall the highest during market corrections, but can also give supernormal returns during market recovery.
Examples: PVR, Blue Star, IEX, Trident, CDSL.
When to buy SMALL-CAP stocks?
Small cap stocks should be bought during times of economic recovery and when market prices are depressed.