What is “free-float market capitalization”?
Many different types of investors hold the shares of a company! The Govt. may hold some of the shares. The “founders” or “directors” of the company may hold some of the shares. Some of the shares may be held by the FDI’s etc. etc! Different investors hold the shares of the company. Some of the shares are hold by Govt. Some of the shares are hold by directors or founders of the company .FDI also hold some of the shares. Open market shares that are free for trading by anyone are called “free-float” shares. Calculation of sensex comes into account, when investors are interested in free float shares. There are certain shares, which are available for trading in open market, but there are some shares, which have, not permit for trade in open market. Any shares that do not fall in these particular criteria can be considered as open market shares.
