Market capitalisation definition

A company’s market capitalisation is the total value of its outstanding shares on the market. It is also referred to as market cap.

Market capitalisation is an easy way for investors to determine a company’s size. It is calculated by multiplying the total number of outstanding shares in a company by its current share price. So if Apple has 6 billion shares outstanding at a value of $100 each, its market cap would be $600 billion dollars.

Investors tend to split stocks into categories based on their market caps: large-cap, mid-cap and small-cap. The boundaries between these categories often vary.

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