Free float market cap

Free float market capitalisation is calculated by multiplying the total number of shares outstanding which is available for the retail public with the price per shares.Here the total number of shares outstanding is different from what we computed in the calculation of market capitalisation as to all those shares with promoters and the key management personnel which are not available for retail public are excluded. This gives us a more realistic and liquid market cap.

Many investors prefer to calculate the free float market capitalisation instead of market cap.