Notices

Market capitalisation

From Traderpedia

Definition:
The he total value of all outstanding shares in a company


Market capitalisation is calculated by multiplying the number of shares outstanding (the float) by their current market price. This term is often referred to as the market cap.

This is the value that the company trades at on the stock market. It is important to note that the price of each share is not meaningful as a guide to the total value of a company unless you know the number of shares in issue.

The traded value of a company depends on a multitude of factors but will be heavily influenced by its size (Sales, earnings, cash flow etc.) and its growth prospects.