Free Float Calculator
Calculate the free float market capitalization and percentage of shares available for trading. Free float represents the portion of shares not held by major shareholders and available for public trading.
Share Information
Free Float Results
Free Float Shares:
Free Float Percentage:
0.00%
Free Float Market Cap:
$0.00
Index Eligibility
S&P 500 Eligibility:
N/A
Russell 2000 Eligibility:
N/A
Liquidity Assessment:
N/A
Business Insights
Ownership Structure:
N/A
Trading Implications:
N/A
Institutional Appeal:
N/A
Understanding Free Float
Free float refers to the portion of a company's shares that are available for trading by the public. It excludes shares held by major shareholders, insiders, and restricted stock. Free float is important for index inclusion, liquidity analysis, and understanding true market capitalization.
Free Float Formula
Free Float Shares
- Free Float = Total Shares - Restricted Shares - Insider Shares
- Restricted Shares = Employee stock options, restricted stock units
- Insider Shares = Shares held by executives and major shareholders
- Usually expressed as a percentage of total shares
Free Float Market Cap
- Free Float Market Cap = Free Float Shares × Share Price
- Represents the actual market value available for trading
- Used by index providers for weighting
- Important for institutional investors
Why Free Float Matters
Key Importance
Free float affects market dynamics
Index Inclusion
- Stock indices use free float weighting
- S&P 500, Russell indices require minimum free float
- Affects index fund composition
- Important for passive investors
Liquidity Analysis
- Higher free float = better liquidity
- Easier to buy/sell large positions
- Lower bid-ask spreads
- Attracts institutional investors
Index Free Float Requirements
| Index | Minimum Free Float | Additional Requirements | Purpose |
|---|---|---|---|
| S&P 500 | 50% | Market cap, liquidity | Large-cap benchmark |
| Russell 2000 | Varies | Size, liquidity | Small-cap benchmark |
| MSCI World | 15-25% | Global standards | Global equity benchmark |
| FTSE 100 | 25% | Liquidity, size | UK large-cap index |
Types of Restricted Shares
Employee Holdings
- Employee stock options (ESOs)
- Restricted stock units (RSUs)
- Employee stock purchase plans
- Shares held by employees
Major Shareholders
- Insider holdings (executives, directors)
- Large institutional investors
- Strategic shareholders
- Government holdings
Free Float Categories
High Free Float (>70%)
- Excellent liquidity
- Easy to trade large volumes
- Attracts institutional investors
- Lower volatility from large trades
Low Free Float (<30%)
- Limited liquidity
- Higher volatility
- Price manipulation risk
- Family-controlled companies
Free Float vs Total Float
Free Float
- Shares available for public trading
- Excludes restricted and insider shares
- Used by indices and institutions
- Represents true market liquidity
Total Float
- All shares not held by founders/majority owners
- Includes employee shares
- Broader definition
- Less commonly used
Key Takeaways for Free Float
- Free float represents shares available for public trading, excluding restricted and insider holdings
- Higher free float percentages indicate better liquidity and institutional appeal
- Index providers use free float for weighting to ensure accurate market representation
- Free float market cap is more relevant than total market cap for investment analysis
- Companies with low free float may have higher volatility and lower liquidity
- Free float requirements vary by index but typically require 15-50% minimum
- Institutional investors prefer high free float stocks for large position management
- Free float can change over time due to employee stock grants and secondary offerings