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Finance GlossaryMarket Capitalization
Market Capitalization
Definition of Market Capitalization
Market Capitalization (or Market Cap) is the total value of a company in the stock market. It is calculated by multiplying the total number of outstanding shares by the current share price. For example, if a company has 1 crore shares priced at ₹100, its market capitalisation is ₹100 crore.
Related Terms
52 Week High
A 52-week high is the highest closing price of a stock or ETF in the last 365 days. Say for example you’re checking the history of a stock on 01-01-2022. Then its 52 week high will be the highest price it closed at between 01-01-2021 and 01-01-2022. 52 week highs are used as technical indicators by traders.
Yield to Maturity (YTM)
Yield to Maturity is the total return an investor can expect if a bond is held until maturity, accounting for interest payments and any gain or loss if purchased at a discount or premium. For example, buying a bond below face value increases its YTM beyond the coupon rate.
At The Close Or Closing Price
At the close or closing price is the last traded price of securities like stocks, ETFs, and others at the end of regular market hours.
For example, if a stock hit Rs. 4,500 at 3.30 PM (market close), then that is its price at the close also known as the closing price.
Unlike Adjusted Closing Price, at the close or closing price does not take into account price changes due to corporate actions.
For example, if a stock hit Rs. 4,500 at 3.30 PM (market close), then that is its price at the close also known as the closing price.
Unlike Adjusted Closing Price, at the close or closing price does not take into account price changes due to corporate actions.
Zero-Coupon Bond
A zero-coupon bond is a debt instrument that does not pay periodic interest but is issued at a deep discount to its face value. Investors earn returns when the bond matures at full value, such as purchasing a ₹1,000 bond for ₹700 and receiving ₹1,000 at maturity.
Market Depth
The number of buy and sell orders available at different price levels for a stock denotes its Market Depth. It helps traders understand supply and demand in the market. Strong market depth means there are many buyers and sellers, making it easier to enter or exit trades without causing large price changes.
Future Trading
Futures trading is the buying and selling of futures contracts on a recognized exchange or over the counter. Futures contracts are derivatives that oblige a trader to buy or sell the underlying security at a predetermined price and date.
Trading futures is possible for equity shares, commodities, currencies, as well as interest rates. Those who trade futures are generally classified as speculators or hedgers.
Speculators trade futures to make a profit. Hedgers delve into futures trading to manage risk, which simply means protecting themselves from unfavorable movements in the market.
Trading futures is possible for equity shares, commodities, currencies, as well as interest rates. Those who trade futures are generally classified as speculators or hedgers.
Speculators trade futures to make a profit. Hedgers delve into futures trading to manage risk, which simply means protecting themselves from unfavorable movements in the market.
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