Market Capitalization

Definition: This is the total value of all of the shares of stock.  You find it by taking the number of shares and multiplying it by the price per share.

TeenAnalyst Advice: This gives you an idea of how big a company is.  Market capitalizations are further broken down into the various categories:

Large cap: $5 billion or more
Mid cap: $1 billion to $5 billion
Small cap: $50 million to $1 billion
Micro cap: Less than $50 million

A general rule of thumb is that small and micro cap stocks are riskier than large cap stocks.

Jonny Boy said:

This is a definition I came up with - what do you think Jodi? Market Capitalization is a measure of value of a company, calculated by multiplying the number of either the outstanding shares or the floating shares by the current price per share. For example, a company with one hundred million shares of floating stock that has a current market value of twenty five dollars a share would have a market capitalization of two billion five hundred million. Outstanding shares include all the stock held by the shareholders, while floating shares are those outstanding shares that actually are available to trade. The term market capitalization is sometimes interchangeably with market value, in explaining.