Float shares

In detail

Float is the subset of shares outstanding that is genuinely available for public trading. It excludes stock held by insiders, founders, and strategic holders, along with restricted shares that cannot yet be sold. The distinction matters because float, not the total share count, determines how much supply meets demand on any given day. A company with a billion shares outstanding but a small free float behaves like a much smaller stock: ordinary order sizes move the price further, spreads are wider, and volatility is higher. Recently listed companies often have small floats that expand sharply when lock-up periods expire — a supply increase that is scheduled and public in advance. Float also affects index inclusion, since most major indices weight by float-adjusted market cap rather than total market cap. And it is the right denominator for short interest: short interest as a percentage of float describes crowding far better than the raw count of shares short does.