At the core of many investor portfolios is an allocation to large cap domestic equities. Because large cap stocks generally have long operating histories, established customer bases, and sufficient cash on hand, they are perceived as the least risky of equity investments, strongly correlated with mid cap and small cap stocks but less volatile than smaller companies. Moreover, because many of these companies are multinational firms that generate revenues from dozens of countries around the world, they provide some degree of international diversification within the equity allocation. [click to continue…]
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