Market capitalization — “market cap” — is the share price multiplied by the number of shares a company has issued. If a company has one billion shares and each trades at 1,000 rupiah, its market cap is one trillion rupiah.
It is the usual way to say how big a listed company is. It changes every time the share price changes.
A higher share price does not by itself mean a bigger company: a company with few shares at a high price can be smaller than one with many shares at a low price. Market cap is what makes them comparable.
Written by NUSANTARA as a general introduction. It explains a term; it is not advice about any security.
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