Investors use the phrase “market cap,” which stands for “market capitalization,” to describe how much a company is worth.
When sorting through and shortlisting the ideal stock from among the hundreds of businesses listed on a stock exchange, market capitalisation is a crucial criterion to utilise. Market cap is the total value of a publicly listed company’s shares. Investors use the phrase “market cap,” which stands for “market capitalization,” to describe how much a company is worth.
A company’s market capitalization is calculated by dividing the total number of shares of outstanding stock by the stock’s current price. If a corporation issued one million shares of stock trading at $100 per share, its market capitalization would be $100 million ($100 multiplied by 1,000,000 shares). Market capitalization, often known as cap, describes how much a firm is worth on the stock market.
But what do these figures suggest? They make it easier to group things into many categories. Companies are often categorised into one of three main groups based on their size: large-cap, mid-cap, and small-cap.
Large-cap: $10 billion or more in market value; often mature, well-established companies with a good reputation.
Companies having a market value between $3 billion and $10 billion are considered midcap; they are frequently well-established companies that operate in areas that are seeing strong growth.
Small-cap: a market value of $3 billion or less; they are often start-up companies that serve niche markets or emerging sectors.
Investments in large-cap stock are often considered to be more conservative than those in small- or mid-cap stock, probably because they carry less risk but have less potential for growth. Because they have gotten stronger through time and weathered challenging business conditions, large-cap corporations frequently have more stable and developed enterprises.
However, because they have already taken advantage of their greatest opportunities to grow to their current size, large organisations may have limited expansion potential.
Here are the top 10 companies with the highest market capitalization
| SL.NO. | COMPANY NAME |
| 1 | Apple ( AAPL ) $2.351 T |
| 2 | Microsoft (MSFT) $1.901 T |
| 3 | Alphabet (GOOG) $1.303 T |
| 4 | Amazon (AMZN) $960.28 B |
| 5 | Berkshire Hathaway (BRK-A) $696.55 B |
| 6 | Tesla (TSLA ) $606.20 B |
| 7 | UnitedHealth (UNH) $500.96 B |
| 8 | Johnson & Johnson (JNJ) $467.67 B |
| 9 | Visa (V) $460.99 B |
| 10 | Exxon Mobil (XOM ) $452.43 B |