What is the price of the entire company?
When doing research, it is important that you look at more than just the current share price – you need to look at the price of the entire company. The “cost” of acquiring the entire corporation is called market capitalization (or market cap for short) and is frequently referred to by financial professionals. In short, the market cap is the price of all outstanding shares of common stock multiplied by the quoted price per share at any given moment in time. A business with one million shares outstanding and a stock price of $50 per share would have a market cap of $50 million. Continue reading →

Investing Mistake 1: Spreading your investments too thin Over the past several decades, Wall Street has preached the virtues of diversification, drilling it into the minds of every investor within earshot. Everyone from the CEO to the delivery boy knows that you shouldn’t keep all your eggs in one basket – but there’s much more to it than that. In fact, many people are doing more damage than good in their effort to diversify. Like everything in life, diversification can be taken too far. Continue reading →