Analyze the market nature of large-cap stocks, small-cap stocks, and alts from the perspectives of underlying logic, market structure, and real-world examples:

1. Large-cap stocks: In the long term, it is a "positive-sum game"
Core logic: Value creation drives long-term returns.

Reinvestment of profits:
Large-cap stocks are usually mature companies (such as Apple and Moutai) that generate profits through their main business, expand their scale through dividends or reinvestment, and drive economic value growth. Long-term holders share in the company's growth dividends, forming a positive cycle of "capital appreciation + dividends."

For example, the S&P 500 index has had an average annual return of about 10% over the past century, primarily from corporate earnings growth (about 6%) and dividends (about 4%).

Liquidity premium:

Market Ecology:
Institution-led pricing, high information transparency, strong price discovery efficiency, and reduced zero-sum game space.

Exceptions:
Short-term bubbles or systemic risks (such as the 2008 financial crisis) may lead to temporary negative returns, but there is long-term mean reversion.

2. Small-cap stocks: Between positive-sum and zero-sum.
Distinctive differentiation characteristics:

Growth small-cap stocks (such as leading companies in niche industries):
Similar to large-cap stocks, value growth achieved through innovation or market expansion may become a source of positive returns.

For example, Tesla's early market value was less than ten billion, and it grew into a giant through the electric vehicle revolution.

Speculative small-cap stocks: liquidity traps: low market capitalization stocks are easily manipulated (such as "zombie stocks"), with prices deviating from fundamentals, forming a zero-sum game of "cutting leeks."

Information asymmetry: retail investors obtain information with a lag, while institutions or insider traders hold an advantage.

For example: Some ST stocks in the A-shares market are speculated through shell resources, ultimately leading to delisting and investor losses.

Academic Support:
The Fama-French three-factor model indicates that small-cap stocks have long-term excess returns (the small-cap effect), but are accompanied by higher volatility and risk.

3. Alts: Nearly a pure zero-sum game.
The essential difference with large-cap stocks:

No cash flow support:
99% of alts do not generate profits or dividends, and their prices completely rely on subsequent buyers taking over, in line with the "Greater Fool Theory."

For example: The founder of Dogecoin (DOGE) publicly admitted that it is "worthless."

High concentration of chips: The top 10% of addresses usually control over 80% of the tokens (like in the early days of SHIB), with manipulators driving the market up and down.

Exchange wash trading, running away, and other black box operations further erode retail investors' interests.

Data evidence: According to CoinGecko statistics in 2022, over 60% of the tokens in the top 3000 cryptocurrencies have dropped more than 90% from their historical highs.

When the correlation between Bitcoin (large market cap) and alts breaks down (as seen at the end of the 2021 bull market), the liquidity of alts quickly dries up.

Few exceptions:
Public chains like Ethereum that have ecological applications may generate internal value through mechanisms such as gas fees and staking, but the proportion is very low.

IV. Key Conclusions: Dynamic Games and Participation Methods
Market Stage Impact Nature: During a bull market with excessive liquidity, small-cap stocks and alts may briefly exhibit "pseudo-positive" (everyone makes money), but a bear market exposes the zero-sum nature.

Large-cap stocks also decline in a bear market, but companies with solid earnings can recover their valuations more quickly.

The role of participants determines the outcome: Long-term investors: The positive effects of large-cap stocks are more pronounced;

Scalpers: Regardless of the asset, the costs of high-frequency trading (fees, slippage) will make the game approach a negative sum.

Policy and regulatory factors: Strict IPO reviews (such as A-shares) enhance the quality of small-cap stocks, while the lack of regulation in cryptocurrencies exacerbates their zero-sum nature.

Ultimately, the "positive-sum" or "zero-sum" properties of assets are not absolute, but rather depend on the time dimension, mode of participation, and the asset's own ability to generate value. Understanding this can help avoid becoming a "passive loser" in the market.