VineLesson 73 · Written for kid, teen, and little
Market cap — how big is the company?
Share price × number of shares = total value of the company.
How big is a company, really? Not the share price — that can fool you. The real measure is market cap: the share price times the total number of shares. A $20 stock can be a giant if there are billions of shares. Bigger companies tend to be steadier; smaller ones can grow faster but bounce around more. 🏛️
Words to know
4Market cap
A company's total size in dollars — share price times the number of shares.
Share price
The cost of one share; on its own it does NOT tell you how big a company is.
Large-cap
A big, well-known company — usually steadier and more stable.
Small-cap / micro-cap
Smaller companies that can grow faster but tend to swing more wildly.
Two companies. A is $20/share, has 50 BILLION shares. B is $400/share, has 100 million shares. Which is bigger?
In the full lesson
- 1Make the call
Vine has 107 lessons like this one, each written three ways so a 7-year-old and a 17-year-old both get a version that fits.
The practice portfolio is open.
Start practicingMore in Analyzing companies
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- 🏰What Makes a Business Hard to CopySome businesses are protected by things rivals can't quickly copy.
- 🎲Speculation vs investingSame stock, totally different mindsets.
- 🌊Dollar-cost averagingThe same planned amount at regular times means fewer timing decisions.
- 🏭Sectors — how the market is split up11 big buckets the market is split into.