Float

Float is the number of shares actually available to trade, excluding those locked up by insiders or the government.

A real-world scenario

A newly listed company has 10% of its shares in the public float and the rest locked up with founders and early investors. A wave of retail buying hits the stock, and with so few shares available, the price triples in a week. It looks like a rocket — until the lock-up expires and insiders sell, flooding the market with shares that were never part of the float. The price collapses as supply finally matches demand. Small floats amplify both the ride up and the fall.

Why it matters

It tells you how tradeable a stock really is, beyond its total count.

Common confusion

A tiny float can swing hard on small orders, raising both opportunity and risk.

Worked example

How investors use it

Before sizing a position, check the float, not just market cap. A small-float stock can move against you fast, so keep positions small and use limit orders.

Key takeaway

Float is the number of shares actually available to trade, and it decides how violent a stock’s moves can be. A small float amplifies everything: buying exhausts supply and sends prices soaring, selling floods the market and craters them, and lock-up expiries can suddenly flood in new supply. Check float before sizing a position, keep small-float bets small, and use limit orders. The float, not the total share count, is what determines how tradeable a stock really is.

Definitions reviewed by the Investing Glossary editorial team.