Large-cap, mid-cap, and small-cap stocks represent different segments of the stock market based on the market capitalization of the companies they represent. Market capitalization is calculated by multiplying the total number of a company's outstanding shares by its current stock price.

Large-cap stocks typically refer to companies with the highest market capitalizations, often exceeding billions of dollars. These companies are usually industry leaders with established track records, extensive operations, and global brand recognition. They tend to have stable revenues and diversified product lines and are generally considered less risky compared to mid-cap and small-cap stocks. Large-cap stocks are often characterized by slower but more predictable growth and are favoured by investors seeking stability and dividends.

Mid-cap stocks represent companies with market capitalizations between those of large caps and small caps. They often possess characteristics of both large and small-cap stocks, offering a balance between growth potential and risk. Mid-cap companies are usually established enterprises with solid fundamentals and may have the potential for rapid growth compared to large caps.

Small-cap stocks, on the other hand, are associated with companies that have relatively low market capitalizations. These companies are often in the early stages of growth, with the potential for substantial appreciation in value but also higher volatility and risk. Small-cap stocks may lack the financial stability and resources of larger counterparts but can offer significant growth opportunities for investors willing to tolerate greater uncertainty.

In summary, the key differences among large-cap, mid-cap, and small-cap stocks lie in their market capitalizations, growth potential, risk levels, and investment characteristics.