I just want to add to what Brian said about choosing digitzed Fonts or Alphabets that comes in several sizes that would work in a 4 x 4 hoop.
Sizes of Fonts are usually based on the height of the letters or certain letters within an Alphabet or font.
But the width of the letters can vary and this is what makes larger letters harder to work with.
Keep in mind that an inch is equal to 25.4mm and a half inch is 12.7mm
A 4x4 hoop is usually 100mm x 100mm and very likely has a stitching area that is smaller than that.
There are several possiblilities of the size of letters you can use in your 4x4 hoop depending on what text you want to make and how many letters you use in the text.
When making text or names don't be afraid of using more than 1 size of letters to form the text.
For a 4x4 hoop you may be able to use a single 3 inch upper case letter for a Monogram, or use a 3 letter uper case monogram in 1.25 inch letter size.
Or you maybe able to form a 10 letter name using 1/2 inch/ .50 inch letters using an upper case letter for the first letter and lower case letters for the rest of the name.
Youy might be able to use .75 inch upper case letter for the first letter and .50 inch lower case letters for the rest of the 10 letter name.
You may be able to make a 2 letter Monogram using 1.50 inch or 1.75 inch upper case letters.
The idea is to find a digitzed Alphabet/Font that has the sizes you can work with within your 4x4 hoop and only have to resize them slightly if need be.
Any Alphabet that has letters from .25 inch to 3 or 3.50 or 4 inches inches would work great for a 4x4 hoop
Here is one example of a digitized Alphabet that comes in several sizes that would work for a 4x4 hoop area.
http://www.digistitches.com/natalie-emb ... -font.html
Many Digitzers now offer their digitzed Fonts or Alphabets in multiple sizes.
Hope this helps you.