what are float shares


Currency. Exchange rate policy that does not limit the range of the market rate.



To permit a country's currency to change freely in value against foreign currencies.


In investment terms, a float is the number of outstanding shares a corporation has available for trading.

If there is a small float, stock prices tend to be volatile, since one large trade could significantly affect the availability and therefore the price of these stocks. If there is a large float, stock prices tend to be more stable.

In banking, the float refers to the time lag between your depositing a check in the bank and the day the funds become available for use. For example, if you deposit a check on Monday, and you can withdraw the cash on Friday, the float is four days and works to the bank's advantage.

Float is also the period that elapses from the time you write a check until it clears your account, which can work to your advantage. However, as checks are increasingly cleared electronically at the point of deposit, this float is disappearing.

In a credit account, float is the amount of time between the date you charge a purchase and the date the payment is due. If you have paid your previous bill in full and on time, you don't owe a finance charge on the amount of the purchase during the float.


(1) The amount of movement in a variable-rate mortgage,as in “the loan can float 1 percent per year or a maximum of 5 percent

in a lifetime.” (2) The period of time after a check is deposited but before the funds have been collected or credited.If a depositor receives credit immediately,even though it may take several days for the maker's bank to transfer funds to the depositor's bank,then the depositor takes advantage of the float because it has use of the money.If a depositor does not receive credit for several days, but the bank has already received its money from the maker's bank, then the bank takes advantage of the float.


Allowing the interest rate and points to vary with changes in market conditions,as opposed to “locking” them.

Floating may be mandatory until the lender's lock requirements have been met. After that, the borrower may elect to lock the rate and points at any time but must do so a few days before the closing.

Allowing the rate to float exposes the borrower to market risk and also to the risk of being taken advantage of by the loan provider. See Locking the Loan /Choosing When to Lock .


What Does Float Mean?

The total number of a company's shares that are publicly owned and available for trading. The float is calculated by subtracting restricted shares from outstanding shares. Also known as free float.

Investopedia explains Float

As an example, a company may have 10 million outstanding shares, but only 7 million are trading on the stock market. Therefore, this company's float would be 7 million. Stocks with small floats of less than 7 million shares tend to be a lot more volatile than others.

Source: financial-dictionary.thefreedictionary.com

Category: Forex

Similar articles: