When working in equity markets, you'll run into a few core terms all the time.

Let's walk through the following terms, equity ticker, and market capitalization.

Let's start with something you'll see on every trading screen.

The equity ticker, every listed stock has a ticker symbol, a short identifier that tells you what the security is and where it trades, and getting that ticker right really matters.

At the start of the pandemic.

Some investors rushed to buy what they thought was Zoom stock, but they accidentally bought shares of Zoom Technologies, an unrelated company with the ticker Zoom instead of Zoom video communications whose real ticker was ZM.

The confusion drove a sharp spike in the wrong company's share price before the SEC halted trading to protect investors.

It's a classic reminder to double check the ticker, the listing venue, and the share class before placing a trade.

However, while this may sound straightforward, in theory, it can be surprisingly tricky to stay on top of. In practice, a company may use one root symbol with different suffixes across different exchange trading venues.

Symbols can also differ by data vendor.

Bloomberg might show one format while Reuters uses another.

Also, a company may have multiple share classes, ordinary versus preferred, or class A versus class B on a trading desk.

It's vital to always confirm you are pulling the correct line, the right share class, and the right listing, especially when placing an order as an error here, can have significant consequences.

Now that we know how to identify a stock, let's look at how the market values it through its market capitalization.

Market cap represents the firm's equity value today.

Essentially, the market's total value of shareholders ownership.

It shows what investors as a whole think the company's equity is worth at this moment in time.

It's not to be confused with enterprise value, which also includes debts and adjustments for cash or cash equivalents.

Market capitalization is calculated as the current share price multiplied by the number of basic shares outstanding.

That's the figure you'll usually See, see displayed on financial terminals or in the financial press.

Analysts often discuss diluted shares in valuation work, for example, when modeling potential dilution from stock options or convertible securities.

But diluted shares are not normally used to compute the headline market cap you see on screens.

Similarly, ad American depository receipts and gdr, global depository receipts should not be added to the basic shares outstanding as they're simply securities that mirror existing common stock, and it would result in double counting if they were included.

It's also important to note that the definition of market cap can vary to depending on the context.

For example, index providers like MSCI or FTS E often use free float market capitalization, which excludes strategic or locked up holdings such as those owned by founders, governments, or controlling shareholders.

This version is typically smaller than the full market cap, but gives a better sense of the company's true potential trading liquidity.

So in summary, the headline market cap uses basic shares outstanding potential dilution is handled separately in valuation models, while the share price itself already reflects all publicly known information about possible future dilution.