Page 42 - Wells Fargo Bank (C) Teaching Note
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APPENDIX 3 Definitions
Appendix 3
Definition
1. market capitalisation
Market capitalisation or market cap is the market value of
a company's issued share capital – in other words. the
number of shares multiplied by the current price of those
shares on the stock market. Companies are ranked as
large-cap, mid-cap and small-cap depending on their
market capitalisation (market cap), though the actual
criteria for classification depend on the market
concerned.
2. current ratio
Current assets divided by current liabilities. A commonly
used measure of a company's liquidity, or its ability to
meet its short-term obligations. Companies in certain
industries, for instance where inventories are low, are
quite comfortable with low current ratios.
