In simple terms, market capitalization is used to measure the size of a company. In other words, market capitalization refers to the value of total number of shares that have been issued by a publicly-traded company.

Another way of describing market capitalization is in terms of the number of outstanding shares that a publicly-traded company has. Market capitalization is calculated by multiplying the total number of outstanding shares by the current market price of one share. So if a company has 5000 outstanding shares and its current share price is 5 dollars, you would calculate its market capitalization in the following manner: 5000 x 5 = 25000. Hence, the market capitalization would be 25000 dollars.

One of the ways publicly-traded companies are categorized is according to their market capitalization or value. In order of largest size they are categorized as follows:

1. Mega Cap
2. Large (Big) Cap
3. Mid Cap
4. Small Cap
5. Micro Cap
6. Nano Cap