Market Cap Formula

Market capitalization, or "market cap," is a way to measure a company's size in the stock market. It is calculated by multiplying the company's current share price by the total number of its outstanding shares. For example, if a company's stock is priced at $50 per share and it has 10 million shares outstanding, its market cap is $500 million. This figure helps investors understand the company's relative size and compare it to others, serving as an indicator of its market value and potential investment risk.