What Is Market Capitalization? Meaning & Example
Definition
Market capitalization is the total value of a company's shares, found by multiplying the share price by the number of shares outstanding. It is a quick way to gauge company size.
Related terms
Large-cap refers to companies with very large market capitalizations, typically in the tens of billions of dollars or more. They are often established and relatively stable.
Small-CapSmall-cap refers to companies with relatively small market capitalizations. They can offer more growth potential but tend to be more volatile.
StockA stock represents partial ownership in a company. Owning shares gives you a claim on part of the company's assets and profits, and sometimes voting rights.
What is Market Capitalization?
Market capitalization is the total value of a company's shares, found by multiplying the share price by the number of shares outstanding. It is a quick way to gauge company size.
Can you give an example of Market Capitalization?
A company with 50 million shares at $40 each has a market cap of $2 billion.