free-float methodology

Definition

A method of calculating the market capitalization of companies within an index. Instead of including all outstanding shares in the calculation, closely held shares in the hands of promoters and governments are excluded. Total outstanding shares (minus locked in shares), multiplied by the price per share reveals the market capitalization of freely trading shares.
Browse Definitions by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
freefall freehold