Financecalendar_todayLast updated: Apr 2026
What is Market Capitalisation?
/ˌmɑːkɪt ˌkæpɪtəˈlaɪˈzeɪʃən/
Market capitalisation (market cap) is the total value of all a company's outstanding shares — calculated by multiplying the share price by the number of shares. It measures a company's size.
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Everyday Example
If a company has 10 million shares trading at £50 each, its market cap is £500 million. Apple's market cap has exceeded £3 trillion, making it the world's most valuable company.
publicReal-World Application
“When comparing companies, market cap matters more than share price — a £10 share in a company with 10 billion shares is "bigger" than a £100 share in a company with 100 million shares.”
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Did you know?
The term became mainstream in the 1990s as investors started classifying stocks as "large-cap," "mid-cap," and "small-cap" to manage portfolio risk.
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Key Insight
Market cap tells you what the market collectively believes a company is worth today — not what it will be worth tomorrow, and not always what it deserves to be worth.
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