Fundamentals & valuation
What is Free float?
Hinglish mein padhein: Free float kya hota hai?
Free float is the part of a company's shares available for public trading, excluding promoter and other locked-in holdings.
Indices use free-float market cap so that companies with large promoter holdings don't get an outsized weight.
A low free float can make a stock more volatile, because fewer shares are available to trade.
Related terms
- Market capitalisationMarket capitalisation is a company's total market value: share price multiplied by the number of shares outstanding.
- Promoter and promoter holdingPromoters are the founders or controlling shareholders of a company. Promoter holding is the percentage of shares they own.
- Stock market indexAn index tracks the combined price movement of a chosen basket of stocks, giving one number for how that part of the market is doing.