Ankle Biter

AAA

DEFINITION of 'Ankle Biter'

Slang term for a stock with low market capitalization. An ankle biter, generally, is a stock that has a market capitalization of less than $500 million. Such stocks are also referred to as micro-cap or small-cap stocks. Although there is no etched-in-stone definition, typically a stock is considered to be a small-cap if it has a market capitalization of $300 million to $2 billion, while a micro-cap stock is any issue with a market cap of less than $300 million.

INVESTOPEDIA EXPLAINS 'Ankle Biter'

The term ankle biter is also used to describe very young children - the idea being that they are so small that they can only reach one's ankles. As an investment, ankle biters - the stocks, not the children - tend to be very volatile and are often thinly traded. On the plus side, ankle biters often have greater growth potential than larger stocks and encompass many emerging technologies.

RELATED TERMS
  1. Large Cap - Big Cap

    A term used by the investment community to refer to companies ...
  2. Small Cap

    Refers to stocks with a relatively small market capitalization. ...
  3. Micro Cap

    A publicly traded company in the United States that has a market ...
  4. Mega Cap

    The biggest companies in the investment universe, as measured ...
  5. Market Capitalization

    The total dollar market value of all of a company's outstanding ...
  6. Nano Cap

    Small public companies with a market capitalization below $5 ...
RELATED FAQS
  1. Is it more beneficial to invest in a blue chip stock or a penny stock?

    Penny and blue-chip are terms used to describe a stock's valuations and statures. Penny stocks are generally the stocks of ... Read Full Answer >>
  2. What is the difference between a penny stock and a small cap stock?

    A penny stock and a small-cap stock represent the shares of a company with low market capitalizations. However, there is ... Read Full Answer >>
  3. How can I tell whether a particular small cap stock has a positive investment outlook?

    The investment outlook for a small-cap stock is determined by operational outlook and current stock price. The operational ... Read Full Answer >>
  4. Why should I be looking at small cap stocks as a potential investment?

    Investors should look at small-capitalization stocks for upside growth potential and portfolio diversification. Despite these ... Read Full Answer >>
  5. How risky are small cap stocks?

    In terms of equity categories based on market capitalization, small caps are the fourth riskiest group out of five. The other ... Read Full Answer >>
  6. Are mid-cap stocks more profitable than large-cap stocks?

    A mid-cap stock may perform better than a large-cap stock. The stock market can be stable or volatile, and many factors affect ... Read Full Answer >>
Related Articles
  1. Investing

    Spot Hotshot Penny Stocks

    Don't flip a coin to find your next investment.
  2. Markets

    Understanding Small- And Big-Cap Stocks

    If you don't realize how big small-cap stocks can be, you'll miss some good investment opportunities.
  3. Insurance

    Market Capitalization Defined

    Find out the differences between mega-, large-, mid- and small-cap stocks and how each suits different investing styles.
  4. Investing Basics

    How To Evaluate A Micro-Cap Company

    Learn how to think big by investing in smaller stocks.
  5. Markets

    An Introduction To Small Cap Stocks

    When it comes to a company's size, bigger isn't always better for investors. Find out more here.
  6. Fundamental Analysis

    Is it Wise to Diversify with Small-Caps?

    Historically, it's always been a good idea to add small-caps to your portfolio. But doing so right now will require more focus and attention.
  7. Economics

    What are Pork-Barrel Politics?

    Pork-barrel politics is a form of patronage whereby politicians favor their constituents in exchange for benefits such as campaign donations and votes.
  8. Options & Futures

    Key Factors Of The Russell 2000 Index

    The Russell 2000 index represents the small cap universe, with a broad selection of fast growth companies at the bottom end of the capitalization spectrum.
  9. Chart Advisor

    Interested in Growth Stocks? See These 4 ETFs

    Given the rise in popularity of growth ETFs, there are several interesting growth stock choices for investors.
  10. Stock Analysis

    Small-Caps and Dividends: Perfect Together

    For investors, small-caps shouldn’t be just about growth. They can be powerful income tools, as well.

You May Also Like

Hot Definitions
  1. Net Worth

    The amount by which assets exceed liabilities. Net worth is a concept applicable to individuals and businesses as a key measure ...
  2. Stop-Loss Order

    An order placed with a broker to sell a security when it reaches a certain price. A stop-loss order is designed to limit ...
  3. Covered Call

    An options strategy whereby an investor holds a long position in an asset and writes (sells) call options on that same asset ...
  4. Butterfly Spread

    A neutral option strategy combining bull and bear spreads. Butterfly spreads use four option contracts with the same expiration ...
  5. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
  6. Moving Average - MA

    A widely used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random ...
Trading Center