How To Read Stock
Market Reports
Article About A Necessary Skill For Anyone Interested In The
Stock Market
In glancing through the stock prices reports listed in the
newspaper one might wonder how stocks are priced and what affects
price movement. After all, there is a wide variety of prices and
some well-known companies are traded for relatively low prices
while obscure listings may sell at high prices.
To a certain extent stock prices are determined by investor
confidence but that confidence in turn is based on real or
perceived performance. Companies report their financial status on a
quarterly basis when they disclose cash flow, sales and earnings.
These hard numbers are the foundation of a company's worth, but
investor speculation can undermine or override actual financial
data.
Rumours abound on the stock market, and if there is news that a
company is about to make a strategic move, buyers may flock to buy
that stock. As with any other market, the principal of supply and
demand applies. If there is a sudden upsurge in investor interest,
the price of a stock will rise accordingly. Conversely, fear among
investors can cause a stock price to plummet. In the long run,
however, company performance and worth are the biggest factors in
determining stock prices.
Stock prices and reports are available from many sources.
Newspapers carry market summaries of the day's movements and online
sources can provide current prices around the clock. Stock brokers
can also provide quotes – either online or by telephone in the case
of full-service brokers.
A stock quote table in a newspaper or Internet web site is full
of useful information that can help the investor make decisions
about buying or selling stocks. Being able to read a stock table is
a necessary skill for anyone interested in the stock market.
A typical table looks like this:
52 Weeks
Symbol Last
Change %
Time High
Low
Volume
High
Low
GOOG 538.48 + 5.01 +
0.94 13:47 541.53 535.07 1,654,565 629.51
289.45
The first column tells you the name of the company by it's
ticker symbol, a 3 or 4 character abbreviation. GOOG is Google
Inc. Ticker symbols can be looked up on the Internet.
Last, is the last price at the time of publication of the table.
In newspapers this would generally be the day's closing price, but
Internet tables may be updated every few minutes. Publicly viewable
stock prices on the Internet usually have a lag of 15 or 20
minutes.
Change is the difference between the previous day's closing
price and the current quote. Time shows the time of the last
transaction. High, Low, and Volume all refer to the current (or
last) trading day. High is the highest price the stock sold for,
Low is the lowest price, and Volume is the number of shares that
have been traded. The 52 week High and Low shows you the highest
and lowest prices in the previous year.
There may be additional columns for information about Bid Price
(the price a buyer is willing to pay), Ask Price (the price a
seller is willing to sell), Price/Earnings ratio (P/E – the stock
price divided by the earnings per share), Market Cap (outstanding
shares multiplied by current market price), and Dividends Per Share
(the current annual dividend the company pays).
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