Stock Market Definitions

Stock Market Definitions

Terms which apply to Stocks and the Stock Market

Definition of stock market and investing terms.

Market Value

Applies to the size of a company. Market value is also referred to as market capitalization or market cap for short. To figure out a company's market cap, you must multiply the outstanding shares of the companies times the current share price.

The categories of Market Cap are: Micro-Cap: companies with market caps under $250 Million. Small-Cap: companies with market caps between $250 Million and $1 Billion. Mid-Cap: companies with market caps between between $1 Billion and $5 Billion. Large-Cap: companies with market caps greater than $5 Billion.

Book Value Take current total assets of a company minus total liabilities. Then divide the result by the current number of outstanding shares. This will give you the book value per share of a company. A company should never sell for less than this amount, and if it does, you may have found a bargain.

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