Tuesday, January 18, 2011

Market Cap

Nice introductory article on market capitalization (market cap). Mkt cap = share price * number of shares outstanding.

For stocks, market cap provides a basic measure of the underlying company's overall value.

According to the article (which draws on data from Morningstar), 'large cap' stocks have market caps greater than $8 billion, 'mid cap' stocks have market caps between $1 billion and $8 billion, and 'small cap' stock have markets caps of less than $1 billion.

As the general value of stocks change, so do the standards for what comprises large, mid, and small cap stocks.

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