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Lesson 1 of 2
Market Cap
The price tag of the company
Stock Price ≠ Company Value.
Market Cap = Share Price × Total Shares
Example:
- Company A: $10 stock × 1B shares = $10B Market Cap
- Company B: $100 stock × 10M shares = $1B Market Cap
Company A is 10x bigger, even though its stock price is lower!
- Large Cap: Safer, slower growth (Apple, Microsoft)
- Small Cap: Riskier, potential for huge growth