What is a Mega Cap?
Mega cap is a designation for any company with a market capitalization in excess of $200 billion.
How Does a Mega Cap Work?
The largest companies in the world are referred to as mega caps because of their relative market size and value.
Any company worth more than $200 billion generally qualifies as a mega-cap company. Microsoft, Exxon and Wal-Mart are examples of mega-cap companies. Since market capitalization fluctuates with the company's stock price, companies can fall in and out of the mega cap classification.
Why Does a Mega Cap Matter?
Due to their size and market value, mega-cap companies are market leaders and wield considerable influence on the direction of their respective market sectors in terms of both their products and their financials. Classifications such as mega cap can change over time.
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