Graduation hats (also called graduation caps) were actually used as everyday medieval scholar hats in the 12th and 13th centuries. Today it is worn only during commencement exercises, usually (but not always) together with a toga. A typical graduation hat consists of a hard, square top called a mortarboard (called trencher in Britain), a headpiece, and a tassel (usually nylon). These caps can be made of cloth or cardboard and come in all sizes.
Stretchable: Look for a graduation cap with a slightly stretchable headpiece so you can adjust it to fall just above your eyebrows. This is the right way to wear a graduation cap.
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