Wednesday, August 16, 2006

Market capitalization

Market capitalization (a.k.a market cap) is simply the share price x the no. of outstanding shares that the company has issued. It is a measure of the "perceived" value of the company. To paraphase, market cap is what the participants in the stock market thinks how much a company is worth, it may or may not reflect its true value, or the intrinsic value of the firm.

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