Float vs Shares Outstanding: Three Different Numbers and When Each Matters

The short version

"Float" is one of the most used and least consistent words in trading. People use it to mean at least three different numbers, and they can differ by tens of percent for the same company on the same day:

1. Shares outstanding. Every share the company has issued and not repurchased.
2. Non-affiliate float. Shares outstanding minus shares held by affiliates (officers, directors and controlling holders). This is the SEC's public float concept, used for the baby shelf rule.
3. Tradeable float. Non-affiliate float minus shares that cannot currently be sold in the market, such as unregistered or locked-up shares. This is closest to what traders mean when they talk about supply.

None of the three is wrong. They answer different questions, and mixing them up produces wrong conclusions about short interest, offering capacity and dilution.

Number 1: shares outstanding

Shares outstanding is the count of shares issued and held by anyone, including insiders. It is stated on the cover page of every 10-Q and 10-K, "as of" a recent date, usually a few days before filing.

It sits inside a hierarchy:

• Authorized shares: the maximum the charter allows the company to issue.
• Issued shares: shares ever issued, including any later repurchased and held in treasury.
• Outstanding shares: issued shares minus treasury shares.

Market capitalisation is shares outstanding times price. Dilution percentages are also usually measured against shares outstanding.

Number 2: non-affiliate float

An affiliate is a person who controls, is controlled by, or is under common control with the company. In practice, companies typically treat executive officers, directors and holders of 10% or more as affiliates when computing this figure. The non-affiliate float excludes their shares.

The SEC uses it in two places that matter here:

• The 10-K cover page states the aggregate market value of common equity held by non-affiliates as of the last business day of the company's most recently completed second fiscal quarter. It decides filer status (for example, whether a company is a smaller reporting company).
• The baby shelf rule caps primary sales off an S-3 at one-third of this float for companies under $75 million, using a price from within 60 days of the sale.

Number 3: tradeable float

Tradeable float tries to measure shares that can actually reach the market today. Starting from non-affiliate float, it removes:

• Unregistered shares held by non-affiliates, such as shares from a PIPE whose resale registration is not yet effective and that are still within the Rule 144 holding period.
• Locked-up shares, held under a lockup agreement from an IPO or offering.
• Sometimes, large strategic holdings that are not affiliates but are not trading either.

There is no SEC definition of tradeable float. Data vendors use different methods, which is why two quote screens can show different floats for the same ticker.

A worked example

Hypothetical Company X:

All figures are hypothetical.

Three facts follow from one company:

• Its market capitalisation is $100 million.
• Its public float for baby shelf purposes is $70 million, under the $75 million threshold, so its S-3 primary sales are capped at one-third, about $23.3 million per 12 months.
• Its tradeable supply is 22,000,000 shares, less than half the share count.

How floats change over time

Each number moves for different reasons:

• Offerings increase shares outstanding and, usually, both floats.
• Insider buying and selling shifts shares between affiliate and non-affiliate holders. Officers and directors report trades on a Form 4.
• Resale registrations going effective and Rule 144 holding periods expiring move restricted shares into tradeable float without changing shares outstanding.
• Lockup expirations do the same for locked-up shares.
• Reverse splits shrink all three in the same proportion.

That is why tradeable float can grow sharply on a day when the share count does not change at all.

Which number to use when

How to check a company on Signal8

• Company pages, for example AAPL, show share count and float data alongside the quote. Check which float definition a figure uses before comparing it to another source.
• The squeeze screener uses float and short interest data, which is where the choice of denominator matters most.
• The Dilution tab, for example AAPL's Dilution tab, is where Signal8 organises filing-derived float and dilution data for covered small-cap issuers.

FAQ

What is the difference between float and shares outstanding?

Shares outstanding counts every issued share not held in treasury, including insiders' shares. Float removes shares that are not freely available to the public. The SEC's public float removes shares held by affiliates. A tradeable float also removes restricted and locked-up shares. Float is always equal to or smaller than shares outstanding.

Why do different websites show different floats?

Because there is no single definition. Some vendors subtract only insider holdings, some also subtract large institutional or strategic holders, and some try to subtract restricted shares. Update timing differs too, since holdings change with every Form 4, 13D, 13G and offering. Always check which definition a source uses.

Is public float the same as tradeable float?

No. Public float, as the SEC uses it, counts all shares held by non-affiliates, including restricted shares those holders cannot sell yet. Tradeable float tries to exclude those. A company that just completed a large private placement can have a public float far larger than its tradeable float.

Where do I find shares outstanding?

On the cover page of the latest 10-Q or 10-K, stated as of a recent date. Prospectus supplements also state shares outstanding before and after the offering. Because offerings, warrant exercises and conversions add shares between filings, the cover page number can lag the current count.