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Glossary entry · What you own
Market cap
Definition
Market capitalization — the total value of all outstanding shares of a company, calculated as share price times number of shares. The standard way to size companies: large-cap (>$10B), mid-cap ($2-10B), small-cap (<$2B). Bigger isn't safer, but it usually means lower volatility.
Example
Apple at $200/share with 15B shares outstanding has a market cap of $3 trillion.
Related
What you own
Stock
A share of ownership in a company. You profit if the company grows; you lose if it falters.
Read →Bond
A loan you make to a government or company. They pay you interest, then return your money.
Read →ETF
A basket of many investments — often hundreds — bought in a single transaction.
Read →Index
A representative basket of a market — like the S&P 500 or the IBEX 35.
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