what you mean by the most valuable company?

Actually I read Apple has become the most valuable company in the world. I actually didn't get what they mean!

Bank of china is worth around 1 trillion wehn apple is worth only US$ 47.79 billion (FY 2010), so what is it? can anyone please explain?

1 Answer

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  • Levi
    Lv 4
    10 years ago
    Favorite Answer

    You are confusing the assets with market capitalization.

    Assets include anything that the company has that holds value. Banks have lots of assets, because they hold all of these deposits, but they also owe this money back to the depositors.

    Market capitalization is the current value of the company, calculated by taking the market value of a share of company stock and multiplying that by the total number shares. The market capitalization of Apple on August 11th 2011 was $337.11 billion.

    In short, the 'value' of a company is determined by the market capitalization, not the assets (although the assets are a factor that investors would use to determine a companies value).

    make sense?

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