Understanding market capitalization by kotak securities


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Understanding market capitalization by kotak securities

  1. 1. Understanding <br />Market Capitalisation<br />
  2. 2. What is Market Capitalisation?<br />
  3. 3. What is Market Capitalisation?<br />Capitalisation or ‘Cap’ is the market value of a stock, indicating the size of the stock available<br /> Market Capitalization = Market price of the stock x <br /> The number of the stock's outstanding* shares<br />* Indicates shares held by the public<br />Example - If a stock has a Current Market Price of Rs 20 per share, and there are 1,00,000 shares in the hands of public investors, then Stock A has a capitalization of 20,00,000<br />
  4. 4. What does Market Cap actually mean?<br />
  5. 5. What Market Cap Actually Means?<br />The company's capitalization is an effective parameter to group corporate stocks<br />Shares or stocks are classified into three categories using the concept of capitalization<br />They are classified on the basis of the relative size of the market in that particular country<br />
  6. 6. 3 Types of Shares<br />
  7. 7. 3 Types of Shares<br />Small – Cap Stocks<br />The stocks of small companies that have the potential to grow rapidly are classified as small-cap stocks<br />These stocks are the best option for an investor who wishes to generate significant gains in the long run<br />Generally the companies that have a market Capitalisation in the range of upto Rs. 250 crores are small cap stocks<br />
  8. 8. 3 Types of Shares<br />Mid – Cap Stocks<br />These stocks are typically stocks of medium-sized companies<br />These are stocks of well-known companies, recognised as seasoned players in the market. They offer you the twin advantages of acquiring stocks with good growth potential as well as the stability of a larger company<br />Generally, these companies have a market capitalisation in the range of Rs. 250-4000 crores <br />
  9. 9. 3 Types of Shares<br />Large – Cap Stocks<br />These stocks of the large companies such as Tata, Reliance, ICICI are classified as large-cap stocks<br />Investors gain the advantages of reaping relatively higher dividends compared to small and mid-cap stocks while also ensuring the long-term preservation of their capital<br />
  10. 10. Did you know? <br /> In India, the market capitalisation of listed companies is around $600 bn while that of US markets is $15 trillion<br />
  11. 11. Thank You!<br /> Questions? Feedback? <br />Click on any of these -<br />Read More<br />Facebook<br />Twitter<br />Website<br />
  12. 12. Registered office: Kotak Securities Limited, 1st Floor, Bakhtawar, 229, Nariman Point, Mumbai - 400021. SEBI Registration No: NSE INB/INF/INE 230808130, BSE INB 010808153/INF 011133230/INE 011207251, OTC INB 200808136, MCXSX INE 260808130. <br />Disclaimer: Investments in securities are subject to market risks, please read the SEBI prescribed Combined RDD prior to investing.<br />* Awarded Best Brokerage Firm in India by AsiaMoney in 2006, 2007, 2008 and 2009<br />