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Compact cameras are intended to be portable (pocketable) and are particularly suitable for casual "snapshots".

Many incorporate a retractable lens assembly that provides optical zoom. In most models, an auto actuating lens cover protects the lens from elements. Most ruggedized or water-resistant models do not retract, and most with (superzoom) capability do not retract fully.

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Compact cameras are usually designed to be easy to use. Almost all include an automatic mode, or "auto mode", which automatically makes all camera settings for the user. Some also have manual controls. Compact digital cameras typically contain a small sensor which trades-off picture quality for compactness and simplicity; images can usually only be stored using lossy compression (JPEG). Most have a built-in flash usually of low power, sufficient for nearby subjects. A few high end compact digital cameras have a hotshoe for connecting to an external flash. Live preview is almost always used to frame the photo on an integrated LCD display. In addition to being able to take still photographs almost all compact cameras have the ability to record video.

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