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Published On: Mon, Jan 28th, 2013

Capitalization

Capitalization (Market Cap) – A company’s Capitalization or Market Cap refers to the value of a publicly traded company.

It is calculated by taking the number of outstanding equity shares multiplied by the current price per share. For example if a company has 10,000,000 share outstanding and available for sale in the open market, and each share is trading at a value of 17.50 GBP, the company’s Capitalization or Market Cap is the 10MM shares x 175GBP = 175,000,000.

Publicly traded companies can be broken down into Micro Cap, 50MM to 300MM; Small Cap, 300MM to 2bn; Medium Cap, 2bn to 10bn; Large Cap, 10bn to 100bn; and Mega Cap, 100bn+.

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About the Author

- Marcus Holland has been trading the financial markets since 2007 with a particular focus on soft commodities. He graduated in 2004 from the University of Plymouth with a BA (Hons) in Business and Finance.

 

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