Market Capitalization

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Market Capitalization, "Market Cap"

The total value of all outstanding shares multiplied by the stock price; usually used to measure the size of a corporation.

Market capitalization represents the aggregate value of a company or stock. The investment community uses this figure to determining a company's size, as opposed to sales or total asset figures.

The stocks of large, medium and small companies are referred to as large-cap, mid-cap, and small-cap, respectively. Investment professionals differ on their exact definitions, but the current approximate categories of market capitalization are:

  • Large cap ($10 billion plus)
  • Mid cap ($2 billion to $10 billion)
  • Small cap (Less than $2 billion)

While these are the most common market cap references, there are also some less commonly used: Mega Cap, Micro cap, and Nano cap. Market cap terms are relative and are constantly changing as companies get bigger and smaller.

Links

Definitions of Market Capitalization on Google


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