Glossarytaught in M0.02
Free float
Also called public float, floating stock.
The proportion of shares available for public trading, excluding promoter, government and other locked-in holdings.
With 74.2% promoter holding, a company has a 25.8% free float.
Float determines how the shares behave. A small float means a thin order book, larger price moves on modest volume, and a valuation that can drift far from fundamentals in either direction for long periods.
It also determines index weight, since major Indian indices weight by free-float market capitalisation and ignore the total.
Check the float before you trust a price signal.