Market capitalization

The New York Stock Exchange on Wall Street, the world's largest stock exchange in terms of total market capitalization of its listed companies[1]

Market capitalization, sometimes referred to as market cap, is the total value of a publicly traded company's outstanding common shares owned by stockholders.[2]

Market capitalization is equal to the market price per common share multiplied by the number of common shares outstanding.[3][4][5] Since outstanding stock is bought and sold in public markets, capitalization could be used as an indicator of public opinion of a company's net worth and is a determining factor in some forms of stock valuation.

  1. ^ "Market highlights for first half-year 2010" (PDF). World Federation of Exchanges. Archived from the original (PDF) on July 22, 2013. Retrieved May 29, 2013.
  2. ^ Graham, John R; Smart, Scott B.; and Megginson, William J. (2010). Corporate Finance (third ed.). Mason OH: South-Western Cengage Learning. p. 387. ISBN 9780324782967.{{cite book}}: CS1 maint: multiple names: authors list (link)
  3. ^ Graham, Smart and Megginson op cit p. 387.
  4. ^ "Market Capitalization Definition". Retrieved April 2, 2013.
  5. ^ "Financial Times Lexicon". Archived from the original on September 25, 2016. Retrieved February 19, 2013.

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