Market Capitalization

Market capitalization, commonly shortened to market cap, indicates the overall value the stock market places on a publicly traded company’s equity at a particular point in time. The figure reflects both the company’s share price and the amount of stock it has outstanding, so changes in either can affect the company’s market cap.

Market cap is commonly used as a shorthand measure of a public company’s size, but it does not show how that value is divided among different groups of shareholders or what a particular investor’s position is worth after a merger, exchange ratio, or dilutive issuance.

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