free float
TRANSCRIPT
7242019 Free Float
httpslidepdfcomreaderfullfree-float 15
ALL ABOUT FREE FLOAT OF A COMPANY
It is Important to view free float
In finance the free float of a company is defined as those shares that are readily available for trading
The concept of free float is particularly important for assigning a weight to a listed company in the
calculation of an index
In practice the number of readily available shares is calculated by subtracting the number of restricted
shares from the total number of shares in issue for a particular company The definition of restricted
shares varies depending on the particular index being calculated
In general the definition for restricted shares include some or all of the following categories
bull Promoters holdings
bull Government holdings
bull Directors holdings
bull Strategic holdings
bull Shares listed on a different exchange
7242019 Free Float
httpslidepdfcomreaderfullfree-float 25
bull Share holdings larger than a certain percentage (eg 5)
Calculated as
Free-Float Methodology
The free-float method is seen as a better way of calculating market capitalization because it provides a
more accurate reflection of market movements When using a free-float methodology the resulting
market capitalization is smaller than what would result from a full-market capitalization method
Free float indicator of a stockrsquos liquidity
helps decide its price
The outstanding shares of a listed company are like an elephantrsquos tusks The more they grow the
more impressive they look But whatrsquos the use of keeping a long knife if you canrsquot use it in your day-
to-day life Similarly a large number of outstanding shares in itself canrsquot be of much use to investors
unless it also leads to an increase in what we call ldquofree floatrdquo
In our day-to-day analysis of different factors affecting the market we often forget that ldquofree floatrdquo
also plays a crucial role in deciding the price of a stock
Johnny OK ldquoFree floatrdquo plays an important role But can you first explain Jinny what exactly a free
float is
Jinny Free float is that portion of the outstanding shares of a listed company that is actually available
for day-to-day trading by investors Normally all outstanding shares are not available for trading For
example a listed company may have 10 million outstanding shares of which only six million may
actually be available for trading
The six million shares would be referred to as free float in market terminology But you may ask
where did the remaining shares go The remaining shares certainly didnrsquot vanish into thin air They
may be lying with the promoters of the company or some other strategic investor interested in themanagement of the company or some other long-term institutional investor who may not be
interested in day-to-day trading
The shares which are not available for day-to-day trading are called ldquorestricted sharesrdquo The decision
for not trading the restricted shares by promoters or strategic investors may be voluntary sometimes
but many times restricted shares are actually forbidden from trading due to a ldquolock-in periodrdquo
imposed by some legal requirement
7242019 Free Float
httpslidepdfcomreaderfullfree-float 35
Johnny So it all boils down to how much free float a company has Is there any method by which we
can estimate the free float of a company
Jinny Many websites provide market information about listed companies which also contains their
shareholding pattern and free float You can yourself estimate the free float of any listed company but
for that you need to pay closer attention to its annual report which discloses the shareholding pattern
of promoters strategic investors and others
For an up-to-date estimate you can also check the quarterly shareholding pattern submitted by listed
companies to stock exchanges It would be better if you keep a watch on public announcements made
by companies from time to time regarding investments or disinvestments by promoters or strategic
shareholders
Once you know how many shares are lying with long-term investors you can subtract that from the
total outstanding shares of a company to arrive at its free float Collecting all this information no
doubt requires effort but the major challenge lies in identifying long-term investors
Other than promoters and self-declared strategic investors how would you know a particular investor
is maintaining his holding due to some long-term business strategy and not for trading To arrive at a
reasonable conclusion use a few rules
Shareholding of government or state agencies in any company is considered to be of long term
Likewise shareholding acquired through private placement or any acquisition requiring disclosure and
open offer under the takeover code could be considered to be long term
Investment made under the foreign direct investment or FDI category and equity held by associate
or group companies can also be considered to be long term
Johnny So estimating free float really requires more effort than doing two plus two But tell me
Jinny why is free float considered that important
Jinny It is important to know about the free float of a listed company because itrsquos an indicator of a
stockrsquos liquidity A more liquid stock can be traded at a lower cost and in less time A lower free float
is a sign of low liquidity which affects both buyers and sellers
The more the number of shares available for trading the more buyers and sellers are able to take part
in the market A small free float means that a lower number of shares is actually available for trading
which makes it much more difficult to match buyers and sellers at their chosen price and time
For this reason many investors avoid illiquid stocks Sometimes buyers are not able to find enough
sellers and sometimes sellers are not able to find enough buyers Such a situation may lead to pricevolatility
Scarcity of shares may in fact artificially push up the prices A small free float means that even a
small rise in demand may push up the prices
It would take much less pull to affect the price of a few thousands shares than it would take to affect
millions A dangerous situation for both buyers and sellers because once the demand ceases the
7242019 Free Float
httpslidepdfcomreaderfullfree-float 45
prices fall back with equal rapidity So those interested in buying a stock having a small free float
must keep this aspect in mind
Johnny Thanks for your words of caution Jinny Shallow waters may hold nasty surprises
What The ldquofree floatrdquo of a listed company denotes shares that are actually available for day-to-day
trading
How Free float can be estimated by analyzing the shareholding pattern as published in the annual
report or quarterly information submitted to stock exchanges and announcements made from time to
time
Why Free float has an impact on prices because it affects stock liquidity
983110983145983150983137983150983139983145983137983148 983123983141983154983158983145983139983141983155 983110983154983141983141 983110983148983151983137983156
983113983139983145983139983145 983138983137983150983147 983089983088983090983090983097983089983086983091
983093
983112983140983142983139 983138983137983150983147 983094983096983090983088983091983086983093983095
983112983151983157983155983145983150983143 983140983141983158983141983148983151983152983149983141983150983156 983142983145983150983137983150983139983141
983152983158983156983148983156983140
983094983096983089983097983091983086983096983092
983123983156983137983156983141 983138983137983150983147 983151983142 983145983150983140983145983137 983093983090983097983090983095983086983091983093
983105983160983145983155 983138983137983150983147 983090983096983091983092983091983086983097983090
983113983150983142983154983137 983108983141983158983142983145983150983139983151983148983156983140 983089983093983091983095983089983086983096983093
983120983157983150983146983137983138 983150983137983156983145983151983150983137983148 983138983137983150983147 983089983091983089983088983097983086983089983096
983115983151983156983137983147 983149983137983144983145983150983140983154983137 983138983137983150983147 983089983090983088983091983094983086983094983097
983122983141983148983145983137983150983139983141 983139983137983152983145983156983137983148 983096983095983092983093983086983091
983117983141983156983137983148983155 983110983154983141983141 983110983148983151983137983156
983124983137983156983137 983123983156983141983141983148 983092983089983096983097983097983086983090983097
983123983156983141983154983148983145983156983141 983113983150983140983157983155983156983154983145983141983155 (983113983150983140983145983137) 983116983156983140 983091983092983090983088983089983086983088983093
983114983145983150983140983137983148 983123983156983141983141983148 amp 983120983151983159983141983154 983116983156983140 983090983096983090983094983088983086983097
983112983145983150983140983137983148983139983151 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983090983090983097983095983089983086983092983090
983123983156983141983141983148 983105983157983155983156983144983151983154983145983156983161 983151983142 983113983150983140983145983137 983089983091983091983089983094983086983089983093
983109983150983141983154983143983161 983123983141983154983158983145983139983141983155 983110983154983141983141 983110983148983151983137983156
983122983141983148983145983137983150983139983141 983145983150983140983157983155983156983154983145983141983155 983089983096983092983092983094983093983086983093
983095
983119983145983148 amp 983150983137983156983157983154983137983148 983143983137983155 983139983151983154983152983151983154983137983156983145983151983150 983091983093983088983094983095983086983092983090
983124983137983156983137 983152983151983159983141983154 983139983151 983148983156983140 983090983089983096983091983095983086983093983091
983118983156983152983139 983148983156983140 983089983096983089983091983088983086983093983089
983111983137983145983148 983145983150983140983145983137 983148983156983140 983089983096983089983088983096983086983096983096
983122983141983148983145983137983150983139983141 983145983150983142983154983137983155983156983154983157983139983156983154983141 983148983156983140 983089983093983095983092983089983086983092983089
983139983137983145983154983150 983145983150983140983145983137 983089983091983090983092983089983086983094983097
983154983141983148983145983137983150983139983141 983152983151983159983141983154 983148983156983140 983093983095983091983092983086983094983094
983120983151983159983141983154 983143983154983145983140 983139983151983154983152983151983154983137983156983145983151983150 983151983142 983145983150983140983145983137 983148983156983140 983094983089983095983096983086983092
983106983144983137983154983137983156 983120983141983156983154983151983148983141983157983149 983094983093983094983093983086983092983090
983105983157983156983151983149983151983138983145983148983141 983110983154983141983141 983110983148983151983137983156
983117983137983144983145983150983140983154983137 amp 983117983137983144983145983150983140983154983137 983116983156983140 983090983089983092983093983090983086983092983093
983124983137983156983137 983117983151983156983151983154983155 983116983156983140 983090983089983088983093983091983086983090983091
983117983137983154983157983156983145 983123983157983162983157983147983145 983113983150983140983145983137 983116983156983140 983089983095983097983090983091983086983093983091
983112983141983154983151 983112983151983150983140983137 983117983151983156983151983154983155 983116983156983140 983089983095983093983094983094983086983090983097
983107983151983150983155983156983154983157983139983156983145983151983150 983110983154983141983141 983110983148983151983137983156
983116983137983154983155983141983150 amp 983124983157983154983138983151 983116983156983140 983097983092983094983094983093983086983089983090
983108983116983110 983116983156983140 983089983090983090983093983088983086983088983090
983125983150983145983156983141983139983144 983116983156983140 983089983088983095983094983093983086983088983094
7242019 Free Float
httpslidepdfcomreaderfullfree-float 55
983120983144983137983154983149983137 983110983154983141983141 983110983148983151983137983156
983107983145983152983148983137 983116983156983140 983089983094983095983093983093983086983093983089
983123983157983150 983120983144983137983154983149983137983139983141983157983156983145983139983137983148 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983089983091983093983090983090983086983097983090
983122983137983150983138983137983160983161 983116983137983138983151983154983137983156983151983154983141983145983155 983116983156983140 983094983096983097983094983086983097983095
983124983141983148983141983139983151983149 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983156983145 983105983145983154983156983141983148 983116983156983140 983091983095983089983093983091983086983091983094
983113983140983141983137 983107983141983148983148983157983148983137983154 983116983156983140 983089983089983093983094983096983086983090983091
983122983141983148983145983137983150983139983141 983107983151983149983149983157983150983145983139983137983156983145983151983150983155 983116983156983140 983089983089983092983089983096983086983092983089
983107983141983149983141983150983156 983110983154983141983141983110983148983151983137983156
983114983137983145983120983154983137983147983137983155983144 983105983155983155983151983139983145983137983156983141983155 983116983156983140 983089983095983091983094983094
983105983149983138983157983146983137 983107983141983149983141983150983156983155 983116983156983140 983097983095983094983090983086983089983096
983105983139983139 983116983156983140 983097983092983096983093983086983091
983107983151983150983155983157983149983141983154 983143983151983151983140983155 983110983154983141983141 983142983148983151983137983156
983113983124983107 983094983096983092983090983097983086983097983092
983112983145983150983140983157983155983156983137983150 983125983150983145983148983141983158983141983154 983116983156983140 983090983091983093983097983096983086983088983096
983113983150983140983157983155983156983154983145983137983148 983149983137983150983157983142983137983139983156983157983154983141 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983137983156 983112983141983137983158983161 983109983148983141983139983156983154983145983139983137983148983155 983116983156983140 983091983097983097983094983090983086983090983092
983123983145983141983149983141983150983155 983116983156983140 983089983089983089983092983088983086983093983089
983105983106983106 983116983156983140 983096983092983094983091983086983093983097
983123983157983162983148983151983150 983109983150983141983154983143983161 983116983156983140 983093983090983097983090983086983089983096
7242019 Free Float
httpslidepdfcomreaderfullfree-float 25
bull Share holdings larger than a certain percentage (eg 5)
Calculated as
Free-Float Methodology
The free-float method is seen as a better way of calculating market capitalization because it provides a
more accurate reflection of market movements When using a free-float methodology the resulting
market capitalization is smaller than what would result from a full-market capitalization method
Free float indicator of a stockrsquos liquidity
helps decide its price
The outstanding shares of a listed company are like an elephantrsquos tusks The more they grow the
more impressive they look But whatrsquos the use of keeping a long knife if you canrsquot use it in your day-
to-day life Similarly a large number of outstanding shares in itself canrsquot be of much use to investors
unless it also leads to an increase in what we call ldquofree floatrdquo
In our day-to-day analysis of different factors affecting the market we often forget that ldquofree floatrdquo
also plays a crucial role in deciding the price of a stock
Johnny OK ldquoFree floatrdquo plays an important role But can you first explain Jinny what exactly a free
float is
Jinny Free float is that portion of the outstanding shares of a listed company that is actually available
for day-to-day trading by investors Normally all outstanding shares are not available for trading For
example a listed company may have 10 million outstanding shares of which only six million may
actually be available for trading
The six million shares would be referred to as free float in market terminology But you may ask
where did the remaining shares go The remaining shares certainly didnrsquot vanish into thin air They
may be lying with the promoters of the company or some other strategic investor interested in themanagement of the company or some other long-term institutional investor who may not be
interested in day-to-day trading
The shares which are not available for day-to-day trading are called ldquorestricted sharesrdquo The decision
for not trading the restricted shares by promoters or strategic investors may be voluntary sometimes
but many times restricted shares are actually forbidden from trading due to a ldquolock-in periodrdquo
imposed by some legal requirement
7242019 Free Float
httpslidepdfcomreaderfullfree-float 35
Johnny So it all boils down to how much free float a company has Is there any method by which we
can estimate the free float of a company
Jinny Many websites provide market information about listed companies which also contains their
shareholding pattern and free float You can yourself estimate the free float of any listed company but
for that you need to pay closer attention to its annual report which discloses the shareholding pattern
of promoters strategic investors and others
For an up-to-date estimate you can also check the quarterly shareholding pattern submitted by listed
companies to stock exchanges It would be better if you keep a watch on public announcements made
by companies from time to time regarding investments or disinvestments by promoters or strategic
shareholders
Once you know how many shares are lying with long-term investors you can subtract that from the
total outstanding shares of a company to arrive at its free float Collecting all this information no
doubt requires effort but the major challenge lies in identifying long-term investors
Other than promoters and self-declared strategic investors how would you know a particular investor
is maintaining his holding due to some long-term business strategy and not for trading To arrive at a
reasonable conclusion use a few rules
Shareholding of government or state agencies in any company is considered to be of long term
Likewise shareholding acquired through private placement or any acquisition requiring disclosure and
open offer under the takeover code could be considered to be long term
Investment made under the foreign direct investment or FDI category and equity held by associate
or group companies can also be considered to be long term
Johnny So estimating free float really requires more effort than doing two plus two But tell me
Jinny why is free float considered that important
Jinny It is important to know about the free float of a listed company because itrsquos an indicator of a
stockrsquos liquidity A more liquid stock can be traded at a lower cost and in less time A lower free float
is a sign of low liquidity which affects both buyers and sellers
The more the number of shares available for trading the more buyers and sellers are able to take part
in the market A small free float means that a lower number of shares is actually available for trading
which makes it much more difficult to match buyers and sellers at their chosen price and time
For this reason many investors avoid illiquid stocks Sometimes buyers are not able to find enough
sellers and sometimes sellers are not able to find enough buyers Such a situation may lead to pricevolatility
Scarcity of shares may in fact artificially push up the prices A small free float means that even a
small rise in demand may push up the prices
It would take much less pull to affect the price of a few thousands shares than it would take to affect
millions A dangerous situation for both buyers and sellers because once the demand ceases the
7242019 Free Float
httpslidepdfcomreaderfullfree-float 45
prices fall back with equal rapidity So those interested in buying a stock having a small free float
must keep this aspect in mind
Johnny Thanks for your words of caution Jinny Shallow waters may hold nasty surprises
What The ldquofree floatrdquo of a listed company denotes shares that are actually available for day-to-day
trading
How Free float can be estimated by analyzing the shareholding pattern as published in the annual
report or quarterly information submitted to stock exchanges and announcements made from time to
time
Why Free float has an impact on prices because it affects stock liquidity
983110983145983150983137983150983139983145983137983148 983123983141983154983158983145983139983141983155 983110983154983141983141 983110983148983151983137983156
983113983139983145983139983145 983138983137983150983147 983089983088983090983090983097983089983086983091
983093
983112983140983142983139 983138983137983150983147 983094983096983090983088983091983086983093983095
983112983151983157983155983145983150983143 983140983141983158983141983148983151983152983149983141983150983156 983142983145983150983137983150983139983141
983152983158983156983148983156983140
983094983096983089983097983091983086983096983092
983123983156983137983156983141 983138983137983150983147 983151983142 983145983150983140983145983137 983093983090983097983090983095983086983091983093
983105983160983145983155 983138983137983150983147 983090983096983091983092983091983086983097983090
983113983150983142983154983137 983108983141983158983142983145983150983139983151983148983156983140 983089983093983091983095983089983086983096983093
983120983157983150983146983137983138 983150983137983156983145983151983150983137983148 983138983137983150983147 983089983091983089983088983097983086983089983096
983115983151983156983137983147 983149983137983144983145983150983140983154983137 983138983137983150983147 983089983090983088983091983094983086983094983097
983122983141983148983145983137983150983139983141 983139983137983152983145983156983137983148 983096983095983092983093983086983091
983117983141983156983137983148983155 983110983154983141983141 983110983148983151983137983156
983124983137983156983137 983123983156983141983141983148 983092983089983096983097983097983086983090983097
983123983156983141983154983148983145983156983141 983113983150983140983157983155983156983154983145983141983155 (983113983150983140983145983137) 983116983156983140 983091983092983090983088983089983086983088983093
983114983145983150983140983137983148 983123983156983141983141983148 amp 983120983151983159983141983154 983116983156983140 983090983096983090983094983088983086983097
983112983145983150983140983137983148983139983151 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983090983090983097983095983089983086983092983090
983123983156983141983141983148 983105983157983155983156983144983151983154983145983156983161 983151983142 983113983150983140983145983137 983089983091983091983089983094983086983089983093
983109983150983141983154983143983161 983123983141983154983158983145983139983141983155 983110983154983141983141 983110983148983151983137983156
983122983141983148983145983137983150983139983141 983145983150983140983157983155983156983154983145983141983155 983089983096983092983092983094983093983086983093
983095
983119983145983148 amp 983150983137983156983157983154983137983148 983143983137983155 983139983151983154983152983151983154983137983156983145983151983150 983091983093983088983094983095983086983092983090
983124983137983156983137 983152983151983159983141983154 983139983151 983148983156983140 983090983089983096983091983095983086983093983091
983118983156983152983139 983148983156983140 983089983096983089983091983088983086983093983089
983111983137983145983148 983145983150983140983145983137 983148983156983140 983089983096983089983088983096983086983096983096
983122983141983148983145983137983150983139983141 983145983150983142983154983137983155983156983154983157983139983156983154983141 983148983156983140 983089983093983095983092983089983086983092983089
983139983137983145983154983150 983145983150983140983145983137 983089983091983090983092983089983086983094983097
983154983141983148983145983137983150983139983141 983152983151983159983141983154 983148983156983140 983093983095983091983092983086983094983094
983120983151983159983141983154 983143983154983145983140 983139983151983154983152983151983154983137983156983145983151983150 983151983142 983145983150983140983145983137 983148983156983140 983094983089983095983096983086983092
983106983144983137983154983137983156 983120983141983156983154983151983148983141983157983149 983094983093983094983093983086983092983090
983105983157983156983151983149983151983138983145983148983141 983110983154983141983141 983110983148983151983137983156
983117983137983144983145983150983140983154983137 amp 983117983137983144983145983150983140983154983137 983116983156983140 983090983089983092983093983090983086983092983093
983124983137983156983137 983117983151983156983151983154983155 983116983156983140 983090983089983088983093983091983086983090983091
983117983137983154983157983156983145 983123983157983162983157983147983145 983113983150983140983145983137 983116983156983140 983089983095983097983090983091983086983093983091
983112983141983154983151 983112983151983150983140983137 983117983151983156983151983154983155 983116983156983140 983089983095983093983094983094983086983090983097
983107983151983150983155983156983154983157983139983156983145983151983150 983110983154983141983141 983110983148983151983137983156
983116983137983154983155983141983150 amp 983124983157983154983138983151 983116983156983140 983097983092983094983094983093983086983089983090
983108983116983110 983116983156983140 983089983090983090983093983088983086983088983090
983125983150983145983156983141983139983144 983116983156983140 983089983088983095983094983093983086983088983094
7242019 Free Float
httpslidepdfcomreaderfullfree-float 55
983120983144983137983154983149983137 983110983154983141983141 983110983148983151983137983156
983107983145983152983148983137 983116983156983140 983089983094983095983093983093983086983093983089
983123983157983150 983120983144983137983154983149983137983139983141983157983156983145983139983137983148 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983089983091983093983090983090983086983097983090
983122983137983150983138983137983160983161 983116983137983138983151983154983137983156983151983154983141983145983155 983116983156983140 983094983096983097983094983086983097983095
983124983141983148983141983139983151983149 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983156983145 983105983145983154983156983141983148 983116983156983140 983091983095983089983093983091983086983091983094
983113983140983141983137 983107983141983148983148983157983148983137983154 983116983156983140 983089983089983093983094983096983086983090983091
983122983141983148983145983137983150983139983141 983107983151983149983149983157983150983145983139983137983156983145983151983150983155 983116983156983140 983089983089983092983089983096983086983092983089
983107983141983149983141983150983156 983110983154983141983141983110983148983151983137983156
983114983137983145983120983154983137983147983137983155983144 983105983155983155983151983139983145983137983156983141983155 983116983156983140 983089983095983091983094983094
983105983149983138983157983146983137 983107983141983149983141983150983156983155 983116983156983140 983097983095983094983090983086983089983096
983105983139983139 983116983156983140 983097983092983096983093983086983091
983107983151983150983155983157983149983141983154 983143983151983151983140983155 983110983154983141983141 983142983148983151983137983156
983113983124983107 983094983096983092983090983097983086983097983092
983112983145983150983140983157983155983156983137983150 983125983150983145983148983141983158983141983154 983116983156983140 983090983091983093983097983096983086983088983096
983113983150983140983157983155983156983154983145983137983148 983149983137983150983157983142983137983139983156983157983154983141 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983137983156 983112983141983137983158983161 983109983148983141983139983156983154983145983139983137983148983155 983116983156983140 983091983097983097983094983090983086983090983092
983123983145983141983149983141983150983155 983116983156983140 983089983089983089983092983088983086983093983089
983105983106983106 983116983156983140 983096983092983094983091983086983093983097
983123983157983162983148983151983150 983109983150983141983154983143983161 983116983156983140 983093983090983097983090983086983089983096
7242019 Free Float
httpslidepdfcomreaderfullfree-float 35
Johnny So it all boils down to how much free float a company has Is there any method by which we
can estimate the free float of a company
Jinny Many websites provide market information about listed companies which also contains their
shareholding pattern and free float You can yourself estimate the free float of any listed company but
for that you need to pay closer attention to its annual report which discloses the shareholding pattern
of promoters strategic investors and others
For an up-to-date estimate you can also check the quarterly shareholding pattern submitted by listed
companies to stock exchanges It would be better if you keep a watch on public announcements made
by companies from time to time regarding investments or disinvestments by promoters or strategic
shareholders
Once you know how many shares are lying with long-term investors you can subtract that from the
total outstanding shares of a company to arrive at its free float Collecting all this information no
doubt requires effort but the major challenge lies in identifying long-term investors
Other than promoters and self-declared strategic investors how would you know a particular investor
is maintaining his holding due to some long-term business strategy and not for trading To arrive at a
reasonable conclusion use a few rules
Shareholding of government or state agencies in any company is considered to be of long term
Likewise shareholding acquired through private placement or any acquisition requiring disclosure and
open offer under the takeover code could be considered to be long term
Investment made under the foreign direct investment or FDI category and equity held by associate
or group companies can also be considered to be long term
Johnny So estimating free float really requires more effort than doing two plus two But tell me
Jinny why is free float considered that important
Jinny It is important to know about the free float of a listed company because itrsquos an indicator of a
stockrsquos liquidity A more liquid stock can be traded at a lower cost and in less time A lower free float
is a sign of low liquidity which affects both buyers and sellers
The more the number of shares available for trading the more buyers and sellers are able to take part
in the market A small free float means that a lower number of shares is actually available for trading
which makes it much more difficult to match buyers and sellers at their chosen price and time
For this reason many investors avoid illiquid stocks Sometimes buyers are not able to find enough
sellers and sometimes sellers are not able to find enough buyers Such a situation may lead to pricevolatility
Scarcity of shares may in fact artificially push up the prices A small free float means that even a
small rise in demand may push up the prices
It would take much less pull to affect the price of a few thousands shares than it would take to affect
millions A dangerous situation for both buyers and sellers because once the demand ceases the
7242019 Free Float
httpslidepdfcomreaderfullfree-float 45
prices fall back with equal rapidity So those interested in buying a stock having a small free float
must keep this aspect in mind
Johnny Thanks for your words of caution Jinny Shallow waters may hold nasty surprises
What The ldquofree floatrdquo of a listed company denotes shares that are actually available for day-to-day
trading
How Free float can be estimated by analyzing the shareholding pattern as published in the annual
report or quarterly information submitted to stock exchanges and announcements made from time to
time
Why Free float has an impact on prices because it affects stock liquidity
983110983145983150983137983150983139983145983137983148 983123983141983154983158983145983139983141983155 983110983154983141983141 983110983148983151983137983156
983113983139983145983139983145 983138983137983150983147 983089983088983090983090983097983089983086983091
983093
983112983140983142983139 983138983137983150983147 983094983096983090983088983091983086983093983095
983112983151983157983155983145983150983143 983140983141983158983141983148983151983152983149983141983150983156 983142983145983150983137983150983139983141
983152983158983156983148983156983140
983094983096983089983097983091983086983096983092
983123983156983137983156983141 983138983137983150983147 983151983142 983145983150983140983145983137 983093983090983097983090983095983086983091983093
983105983160983145983155 983138983137983150983147 983090983096983091983092983091983086983097983090
983113983150983142983154983137 983108983141983158983142983145983150983139983151983148983156983140 983089983093983091983095983089983086983096983093
983120983157983150983146983137983138 983150983137983156983145983151983150983137983148 983138983137983150983147 983089983091983089983088983097983086983089983096
983115983151983156983137983147 983149983137983144983145983150983140983154983137 983138983137983150983147 983089983090983088983091983094983086983094983097
983122983141983148983145983137983150983139983141 983139983137983152983145983156983137983148 983096983095983092983093983086983091
983117983141983156983137983148983155 983110983154983141983141 983110983148983151983137983156
983124983137983156983137 983123983156983141983141983148 983092983089983096983097983097983086983090983097
983123983156983141983154983148983145983156983141 983113983150983140983157983155983156983154983145983141983155 (983113983150983140983145983137) 983116983156983140 983091983092983090983088983089983086983088983093
983114983145983150983140983137983148 983123983156983141983141983148 amp 983120983151983159983141983154 983116983156983140 983090983096983090983094983088983086983097
983112983145983150983140983137983148983139983151 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983090983090983097983095983089983086983092983090
983123983156983141983141983148 983105983157983155983156983144983151983154983145983156983161 983151983142 983113983150983140983145983137 983089983091983091983089983094983086983089983093
983109983150983141983154983143983161 983123983141983154983158983145983139983141983155 983110983154983141983141 983110983148983151983137983156
983122983141983148983145983137983150983139983141 983145983150983140983157983155983156983154983145983141983155 983089983096983092983092983094983093983086983093
983095
983119983145983148 amp 983150983137983156983157983154983137983148 983143983137983155 983139983151983154983152983151983154983137983156983145983151983150 983091983093983088983094983095983086983092983090
983124983137983156983137 983152983151983159983141983154 983139983151 983148983156983140 983090983089983096983091983095983086983093983091
983118983156983152983139 983148983156983140 983089983096983089983091983088983086983093983089
983111983137983145983148 983145983150983140983145983137 983148983156983140 983089983096983089983088983096983086983096983096
983122983141983148983145983137983150983139983141 983145983150983142983154983137983155983156983154983157983139983156983154983141 983148983156983140 983089983093983095983092983089983086983092983089
983139983137983145983154983150 983145983150983140983145983137 983089983091983090983092983089983086983094983097
983154983141983148983145983137983150983139983141 983152983151983159983141983154 983148983156983140 983093983095983091983092983086983094983094
983120983151983159983141983154 983143983154983145983140 983139983151983154983152983151983154983137983156983145983151983150 983151983142 983145983150983140983145983137 983148983156983140 983094983089983095983096983086983092
983106983144983137983154983137983156 983120983141983156983154983151983148983141983157983149 983094983093983094983093983086983092983090
983105983157983156983151983149983151983138983145983148983141 983110983154983141983141 983110983148983151983137983156
983117983137983144983145983150983140983154983137 amp 983117983137983144983145983150983140983154983137 983116983156983140 983090983089983092983093983090983086983092983093
983124983137983156983137 983117983151983156983151983154983155 983116983156983140 983090983089983088983093983091983086983090983091
983117983137983154983157983156983145 983123983157983162983157983147983145 983113983150983140983145983137 983116983156983140 983089983095983097983090983091983086983093983091
983112983141983154983151 983112983151983150983140983137 983117983151983156983151983154983155 983116983156983140 983089983095983093983094983094983086983090983097
983107983151983150983155983156983154983157983139983156983145983151983150 983110983154983141983141 983110983148983151983137983156
983116983137983154983155983141983150 amp 983124983157983154983138983151 983116983156983140 983097983092983094983094983093983086983089983090
983108983116983110 983116983156983140 983089983090983090983093983088983086983088983090
983125983150983145983156983141983139983144 983116983156983140 983089983088983095983094983093983086983088983094
7242019 Free Float
httpslidepdfcomreaderfullfree-float 55
983120983144983137983154983149983137 983110983154983141983141 983110983148983151983137983156
983107983145983152983148983137 983116983156983140 983089983094983095983093983093983086983093983089
983123983157983150 983120983144983137983154983149983137983139983141983157983156983145983139983137983148 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983089983091983093983090983090983086983097983090
983122983137983150983138983137983160983161 983116983137983138983151983154983137983156983151983154983141983145983155 983116983156983140 983094983096983097983094983086983097983095
983124983141983148983141983139983151983149 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983156983145 983105983145983154983156983141983148 983116983156983140 983091983095983089983093983091983086983091983094
983113983140983141983137 983107983141983148983148983157983148983137983154 983116983156983140 983089983089983093983094983096983086983090983091
983122983141983148983145983137983150983139983141 983107983151983149983149983157983150983145983139983137983156983145983151983150983155 983116983156983140 983089983089983092983089983096983086983092983089
983107983141983149983141983150983156 983110983154983141983141983110983148983151983137983156
983114983137983145983120983154983137983147983137983155983144 983105983155983155983151983139983145983137983156983141983155 983116983156983140 983089983095983091983094983094
983105983149983138983157983146983137 983107983141983149983141983150983156983155 983116983156983140 983097983095983094983090983086983089983096
983105983139983139 983116983156983140 983097983092983096983093983086983091
983107983151983150983155983157983149983141983154 983143983151983151983140983155 983110983154983141983141 983142983148983151983137983156
983113983124983107 983094983096983092983090983097983086983097983092
983112983145983150983140983157983155983156983137983150 983125983150983145983148983141983158983141983154 983116983156983140 983090983091983093983097983096983086983088983096
983113983150983140983157983155983156983154983145983137983148 983149983137983150983157983142983137983139983156983157983154983141 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983137983156 983112983141983137983158983161 983109983148983141983139983156983154983145983139983137983148983155 983116983156983140 983091983097983097983094983090983086983090983092
983123983145983141983149983141983150983155 983116983156983140 983089983089983089983092983088983086983093983089
983105983106983106 983116983156983140 983096983092983094983091983086983093983097
983123983157983162983148983151983150 983109983150983141983154983143983161 983116983156983140 983093983090983097983090983086983089983096
7242019 Free Float
httpslidepdfcomreaderfullfree-float 45
prices fall back with equal rapidity So those interested in buying a stock having a small free float
must keep this aspect in mind
Johnny Thanks for your words of caution Jinny Shallow waters may hold nasty surprises
What The ldquofree floatrdquo of a listed company denotes shares that are actually available for day-to-day
trading
How Free float can be estimated by analyzing the shareholding pattern as published in the annual
report or quarterly information submitted to stock exchanges and announcements made from time to
time
Why Free float has an impact on prices because it affects stock liquidity
983110983145983150983137983150983139983145983137983148 983123983141983154983158983145983139983141983155 983110983154983141983141 983110983148983151983137983156
983113983139983145983139983145 983138983137983150983147 983089983088983090983090983097983089983086983091
983093
983112983140983142983139 983138983137983150983147 983094983096983090983088983091983086983093983095
983112983151983157983155983145983150983143 983140983141983158983141983148983151983152983149983141983150983156 983142983145983150983137983150983139983141
983152983158983156983148983156983140
983094983096983089983097983091983086983096983092
983123983156983137983156983141 983138983137983150983147 983151983142 983145983150983140983145983137 983093983090983097983090983095983086983091983093
983105983160983145983155 983138983137983150983147 983090983096983091983092983091983086983097983090
983113983150983142983154983137 983108983141983158983142983145983150983139983151983148983156983140 983089983093983091983095983089983086983096983093
983120983157983150983146983137983138 983150983137983156983145983151983150983137983148 983138983137983150983147 983089983091983089983088983097983086983089983096
983115983151983156983137983147 983149983137983144983145983150983140983154983137 983138983137983150983147 983089983090983088983091983094983086983094983097
983122983141983148983145983137983150983139983141 983139983137983152983145983156983137983148 983096983095983092983093983086983091
983117983141983156983137983148983155 983110983154983141983141 983110983148983151983137983156
983124983137983156983137 983123983156983141983141983148 983092983089983096983097983097983086983090983097
983123983156983141983154983148983145983156983141 983113983150983140983157983155983156983154983145983141983155 (983113983150983140983145983137) 983116983156983140 983091983092983090983088983089983086983088983093
983114983145983150983140983137983148 983123983156983141983141983148 amp 983120983151983159983141983154 983116983156983140 983090983096983090983094983088983086983097
983112983145983150983140983137983148983139983151 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983090983090983097983095983089983086983092983090
983123983156983141983141983148 983105983157983155983156983144983151983154983145983156983161 983151983142 983113983150983140983145983137 983089983091983091983089983094983086983089983093
983109983150983141983154983143983161 983123983141983154983158983145983139983141983155 983110983154983141983141 983110983148983151983137983156
983122983141983148983145983137983150983139983141 983145983150983140983157983155983156983154983145983141983155 983089983096983092983092983094983093983086983093
983095
983119983145983148 amp 983150983137983156983157983154983137983148 983143983137983155 983139983151983154983152983151983154983137983156983145983151983150 983091983093983088983094983095983086983092983090
983124983137983156983137 983152983151983159983141983154 983139983151 983148983156983140 983090983089983096983091983095983086983093983091
983118983156983152983139 983148983156983140 983089983096983089983091983088983086983093983089
983111983137983145983148 983145983150983140983145983137 983148983156983140 983089983096983089983088983096983086983096983096
983122983141983148983145983137983150983139983141 983145983150983142983154983137983155983156983154983157983139983156983154983141 983148983156983140 983089983093983095983092983089983086983092983089
983139983137983145983154983150 983145983150983140983145983137 983089983091983090983092983089983086983094983097
983154983141983148983145983137983150983139983141 983152983151983159983141983154 983148983156983140 983093983095983091983092983086983094983094
983120983151983159983141983154 983143983154983145983140 983139983151983154983152983151983154983137983156983145983151983150 983151983142 983145983150983140983145983137 983148983156983140 983094983089983095983096983086983092
983106983144983137983154983137983156 983120983141983156983154983151983148983141983157983149 983094983093983094983093983086983092983090
983105983157983156983151983149983151983138983145983148983141 983110983154983141983141 983110983148983151983137983156
983117983137983144983145983150983140983154983137 amp 983117983137983144983145983150983140983154983137 983116983156983140 983090983089983092983093983090983086983092983093
983124983137983156983137 983117983151983156983151983154983155 983116983156983140 983090983089983088983093983091983086983090983091
983117983137983154983157983156983145 983123983157983162983157983147983145 983113983150983140983145983137 983116983156983140 983089983095983097983090983091983086983093983091
983112983141983154983151 983112983151983150983140983137 983117983151983156983151983154983155 983116983156983140 983089983095983093983094983094983086983090983097
983107983151983150983155983156983154983157983139983156983145983151983150 983110983154983141983141 983110983148983151983137983156
983116983137983154983155983141983150 amp 983124983157983154983138983151 983116983156983140 983097983092983094983094983093983086983089983090
983108983116983110 983116983156983140 983089983090983090983093983088983086983088983090
983125983150983145983156983141983139983144 983116983156983140 983089983088983095983094983093983086983088983094
7242019 Free Float
httpslidepdfcomreaderfullfree-float 55
983120983144983137983154983149983137 983110983154983141983141 983110983148983151983137983156
983107983145983152983148983137 983116983156983140 983089983094983095983093983093983086983093983089
983123983157983150 983120983144983137983154983149983137983139983141983157983156983145983139983137983148 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983089983091983093983090983090983086983097983090
983122983137983150983138983137983160983161 983116983137983138983151983154983137983156983151983154983141983145983155 983116983156983140 983094983096983097983094983086983097983095
983124983141983148983141983139983151983149 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983156983145 983105983145983154983156983141983148 983116983156983140 983091983095983089983093983091983086983091983094
983113983140983141983137 983107983141983148983148983157983148983137983154 983116983156983140 983089983089983093983094983096983086983090983091
983122983141983148983145983137983150983139983141 983107983151983149983149983157983150983145983139983137983156983145983151983150983155 983116983156983140 983089983089983092983089983096983086983092983089
983107983141983149983141983150983156 983110983154983141983141983110983148983151983137983156
983114983137983145983120983154983137983147983137983155983144 983105983155983155983151983139983145983137983156983141983155 983116983156983140 983089983095983091983094983094
983105983149983138983157983146983137 983107983141983149983141983150983156983155 983116983156983140 983097983095983094983090983086983089983096
983105983139983139 983116983156983140 983097983092983096983093983086983091
983107983151983150983155983157983149983141983154 983143983151983151983140983155 983110983154983141983141 983142983148983151983137983156
983113983124983107 983094983096983092983090983097983086983097983092
983112983145983150983140983157983155983156983137983150 983125983150983145983148983141983158983141983154 983116983156983140 983090983091983093983097983096983086983088983096
983113983150983140983157983155983156983154983145983137983148 983149983137983150983157983142983137983139983156983157983154983141 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983137983156 983112983141983137983158983161 983109983148983141983139983156983154983145983139983137983148983155 983116983156983140 983091983097983097983094983090983086983090983092
983123983145983141983149983141983150983155 983116983156983140 983089983089983089983092983088983086983093983089
983105983106983106 983116983156983140 983096983092983094983091983086983093983097
983123983157983162983148983151983150 983109983150983141983154983143983161 983116983156983140 983093983090983097983090983086983089983096
7242019 Free Float
httpslidepdfcomreaderfullfree-float 55
983120983144983137983154983149983137 983110983154983141983141 983110983148983151983137983156
983107983145983152983148983137 983116983156983140 983089983094983095983093983093983086983093983089
983123983157983150 983120983144983137983154983149983137983139983141983157983156983145983139983137983148 983113983150983140983157983155983156983154983145983141983155 983116983156983140 983089983091983093983090983090983086983097983090
983122983137983150983138983137983160983161 983116983137983138983151983154983137983156983151983154983141983145983155 983116983156983140 983094983096983097983094983086983097983095
983124983141983148983141983139983151983149 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983156983145 983105983145983154983156983141983148 983116983156983140 983091983095983089983093983091983086983091983094
983113983140983141983137 983107983141983148983148983157983148983137983154 983116983156983140 983089983089983093983094983096983086983090983091
983122983141983148983145983137983150983139983141 983107983151983149983149983157983150983145983139983137983156983145983151983150983155 983116983156983140 983089983089983092983089983096983086983092983089
983107983141983149983141983150983156 983110983154983141983141983110983148983151983137983156
983114983137983145983120983154983137983147983137983155983144 983105983155983155983151983139983145983137983156983141983155 983116983156983140 983089983095983091983094983094
983105983149983138983157983146983137 983107983141983149983141983150983156983155 983116983156983140 983097983095983094983090983086983089983096
983105983139983139 983116983156983140 983097983092983096983093983086983091
983107983151983150983155983157983149983141983154 983143983151983151983140983155 983110983154983141983141 983142983148983151983137983156
983113983124983107 983094983096983092983090983097983086983097983092
983112983145983150983140983157983155983156983137983150 983125983150983145983148983141983158983141983154 983116983156983140 983090983091983093983097983096983086983088983096
983113983150983140983157983155983156983154983145983137983148 983149983137983150983157983142983137983139983156983157983154983141 983110983154983141983141 983110983148983151983137983156
983106983144983137983154983137983156 983112983141983137983158983161 983109983148983141983139983156983154983145983139983137983148983155 983116983156983140 983091983097983097983094983090983086983090983092
983123983145983141983149983141983150983155 983116983156983140 983089983089983089983092983088983086983093983089
983105983106983106 983116983156983140 983096983092983094983091983086983093983097
983123983157983162983148983151983150 983109983150983141983154983143983161 983116983156983140 983093983090983097983090983086983089983096