नमस्कार मित्रो। एंजेल ब्रोकिंग के इस podcast में आपका स्वागत है ।
Today we will discuss a concept that is truly basic and must be present in the cognitive toolbox of every aspiring trader. Yeah comcept hai market capitalisation. Market capitalisation aapko yah batata hai ki koi firm ki market mein jagah badi hai ya chhoti. Market capitalisation 1 firm ke size ke alava aur bhi important information convey karta hai.
First let's start with the definition of market capitalisation. Market capitalisation is not an opinion or an analysis - it is a number. Market capitalisation is obtained by multiplying a firm's stock price by the number of outstanding shares in the market. Ab aap soch rahe honge Bus itna simple? That is the beauty of market capitalisation. It is very easy to calculate and it captures two important facts about the firm.
What are these facts? First, market capitalisation tells you how established a company is. A big market capitalisation means a lot of investors trust the company to deliver returns over time. A smaller market capitalisation means that the company is relatively smaller in size and operations, it is relatively undiscovered, and investors do not trust it to provide stable returns.
This leads to the second fact captured in the market capitalisation of a company. That fact is the company's risk profile. A higher market cap implies that investing in the company carries relatively lower risk. A smaller market cap implies that your investments may not see good returns. Why, then, do people bother with small cap stocks? The answer to this question has to do with the relationship between rewards and risk. Stocks with higher risk may also carry with them the potential for a higher reward. For certain people a higher risk is an acceptable price to pay for the possibility of making huge profits down the line.
Let's note that a company's market capitalisation is important because it is very easy to calculate and it gives a good working understanding of the company's size and risk profile.
According to their market capitalisation, companies are primarily divided into three types. The three types of companies are large cap companies, mid cap companies and small cap companies. Large cap companies have huge market capitalisation, often running into tens of billions of dollars. In India companies that have a market capitalisation of over 20,000 crores are considered large cap companies. Inn companies ke stocks ko Blue chip stocks bhi kaha jata hai.
Yah companies matured sectors ke bade players hote Hain. These companies have provided investors with stable returns over the years. Companies are not legally obliged to pay dividends to their common shareholders. However large cap companies have a reputation of regularly paying dividends. Investing in a large cap company can be a form of earning casual income. Casual income is the income you can make when you are pursuing other opportunities and engaging in other activities. Investing in large cap companies qualifies as casual income because you can continue to earn with these investments even as you continue your day job or when you sleep at night. Because of their size, large cap companies also carry lower risk. In an economic crisis these companies may be the first one to get bailed out. Government inn companies ko "too big to fail" manati hai, aur isliye crisis mein pahla assistance inko hi jaata hai.
India mein Jin companies ka market capitalisation 5000 karod se 20000 karod ke bich mein hota hai unhen mid cap companies Mana jata hai. These companies carry higher risk than large cap companies. Yah companies established players nahin Hoti hai aur yah kafi baar young sectors aur industries mein Pai jaati hai. However investors still invest in mid cap companies because of the future growth potential of both the company itself and the sector in which they are present. iss baat Ko ek example ke sath samajhte Hain. India mein electric cars ka market bahut small hai. But climate change aur changing consumer preferences ki vajah se ho sakta hai ki future mein market bahut bada ho jaaye. Therefore, keeping this potential market expansion in mind it may be wise to invest in an electric car maker. The investment may not start providing stable returns off the bat, but there may be windfall gains possible down the line.
Now take this logic and push it to the extreme to understand small cap stocks. Any company with market capitalisation below 5000 crores is considered a small cap company. Inn companies mein invest karna risky hota hai par potential rewards bhi bahut high rahte hain. Therefore small cap stocks are ideal for people with healthy risk appetites. For small cap investors one big profit run can make up for a lot of losses. It requires a person with a certain disposition to play this game of frequent losses, and high but irregular profits, for the long term.
Market capitalisation is a useful number par ye har baar Poori aur sacchi kahani nahin batata. Market capitalisation mein company ka stock price ek important variable hota hai. Aur ye stock price har baar company ki inherent value reflect nahin karta. Companies are often undervalued or overvalued. Therefore a small cap company may be less risky than it looks, and a large cap company may carry greater risk than it seems to, at first glance.
Therefore, it is important to look at other metrics and numbers beyond market capitalisation as well. Market Capitalisation is, in conclusion a good place to start but definitely not the right place to stop at.
चलिए, एंजेल ब्रोकिंग की तरफ से आपको आज के अलविदा. ये podcast शेयर करना ना भूलियेगा - याद रखियेगा की ज्ञान बाटने से बढ़ता है । और फिर अंत में तोह financial markets एक ऐसी university है जिसमे कोई professor नहीं, सब students ही है ।