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I hate how "market capitalization" is used. Intuitively it means how much of the market is served by the particular company, when in reality people use it to re
by chmod775 4y ago
I hate how "market capitalization" is used. Intuitively it means how much of the market is served by the particular company, when in reality people use it to refer to the value of the company on markets where we trade shares of companies. As illustrated by this chart, those two numbers have at best a tenuous correlation: For example Tesla, a comparatively small car manufacturer, can be found on this chart, while their much larger competitors can't.
"Market value" (like in the HN title vs. on the site) is a much better word.
- kube-system 4y agoAre you thinking “market share”? “Capitalization”s base word is “capital”.
- chmod775 4y agoCapitalization comes from the verb capitalize, which itself comes from the word capital. To capitalize means to convert something into capital. So at face value "market capitalization" means "degree to which a market was converted into capital", which is clearly not how the word is used. If you want a similar word: crystal -> crystallize -> crystallization capital -> capitalize -> capitalization Both describe a conversion, except that "market capitalization" is not about a process at all.
- kube-system 4y ago> So at face value "market capitalization" means "degree to which a market was converted into capital", which is clearly not how the word is used. “Market” in “a company’s market capitalization” is an attributive noun: a noun acting as an adjective. It is not the subject of a verb.