Market Cap
Market capitalisation (Market Cap) is the total value of a company’s shares.
Quick reference:
Formula: Share price * number of shares. Categories: Large-cap, mid-cap, small-cap.
Used for: Comparing company size and valuations. Impact: Determines index weightings.
Expanded explanation:
Market cap gives a quick measure of how big a company is on the stock market. For example, if a company has 1 billion shares and the share price is $10, it has a market cap of $10 Billion.
Investors often group companies by size. Large-cap stocks are usually more stable, while smaller companies can be riskier but may have higher growth potential. Market cap also decides how much influence a company has in indexes like the ASX200.
Related links + Articles:
• Index.