Market Cap or “Market Capitalization” refers to the total market value of a certain company or establishment based on the total value of its outstanding shares being traded on the market.
This can be calculated by multiplying the total shares to the current price per share. A company having one million shares which cost $10 per share has a market capitalization of $10,000,000.
Market cap is one of the most important factors investors use to gauge whether the company is established or not.
Theoretically, a company with bigger market cap compared to its fellow competitors may indicate that such company is more established than its rivals, thus a good company to invest with.
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