Wednesday, 28 October 2015

Bizblog term of the week:Market Capitalization




    Market capitalization is the total market value of the outstanding shares of a publicly traded company.It is the total number of outstanding shares multiplied by current market share price.

  The value of a company's market capitalization is a major determinant factor of a company's size(i.e net worth) & stock valuation. Company's can fall into the Large ,Medium & Small capitalization group which all depends on the value of their market capitalisation.

 Lets take for instance,a company with an oustanding shares of 10,000,000 to which their current market share price is N5,the market capitalisation of such company stands at N50,000,000(10,000,000shares x N5)

   Market capitalization figure of a company helps individuals make investment decisions in terms of risk and return on their prospective investment.



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