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Stock Quotes: How to Read — and Use — Them

Stock Quotes: How to Read — and Use — Them

axp_-1643-083-532-_-american-express-co-yahoo-finance

    Reading a stock quote can seem like an exercise in black magic: even if you have a good idea of what the many numbers associated with trading a stock mean, making use of them can be harder. Even seasoned traders have to stop and think about what certain combinations of numbers can mean, especially if they’re trying to decide which way a stock is going to go in the future. My trading is limited to a handful of investments right now, but I’ve created a cheat sheet for understanding what the various parts of a stock quote mean — and how they fit together.

    The Layout

    Stock quotes follow a similar format whether you’re using Yahoo! Finance (where the above stock quote came from) or you’ve gone old-school and picked up the morning paper: certain pieces of information are always included. At the top of the quote is the name of the company being traded — in this case, American Express — as well as the stock’s ticker symbol. Here, the ticker symbol reads “NYSE: AXP,” indicating that the stock, AXP, is traded on the New York Stock Exchange. There are quite a few stock exchanges that a stock could be traded on: major cities like Tokyo and London have their own exchanges, as do certain countries, like Australia and Switzerland. Wikipedia has a list of the major stock exchanges, along with in-depth information about each one.

    The numbers making up a stock quote are divided into two columns: the left-hand column focuses more on the basic facts while the right hand side reflects a little more analysis.

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    Last Trade

    Whenever you want to know the current price of a stock, you want to know the last trade. This number reflects the last price that a single share of this particular stock sold at. It can change in an instant: it’s set by buyers and sellers trading the stock for whatever they think it’s worth right now.

    Trade Time

    Knowing the last trade price may not be so useful if that price is actually out of date. The trade time tells you whether you should really rely on that last trade price — it’s the time that last trade took place — or if you should go out and get an update. It’s common for a trade time to lag a few minutes behind your actual time, especially online.

    Change

    Change just indicates the difference between what the last trade price is and what the price before that was. I don’t find this a particularly useful indicator of a stock’s performance, as it only tells you what a stock did in the last two minutes and ignores the entire history of the company beyond that.

    Prev. Close

    Another limited indicator of a stock’s performance, the previous close is the price that the last share of stock sold yesterday (or the last day of trading) sold at. It’s only one sale in a 24-hour period, limiting how big of a picture it can provide you.

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    Open

    The open is the price of the first share of stock sold today.

    Bid & Ask

    It’s common to see both the bid and ask sections of a stock quote blank, or listed as ‘N/A’. A bid is the highest price that a principle brokerage firm has announced it’s willing to pay for a share of a specific stock at a specific time. The ask is the opposite: it’s the lowest price that a firm has said it’s willing to sell a particular stock at.

    1y Target Est

    The one-year target estimate is an analyst’s projection of what the price for a single share of this stock one year from today. But because of all the variables in the market, these projections can vary extremely between analysts. I wouldn’t bet the house on a one-year target estimate.

    Day’s Range

    Starting the right-hand side of the stock quote is the day’s range. Rather than relying on a single share to give you an idea of what a stock is doing now, the day’s range gives you the range that a stock’s price has varied by over the course of the day.

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    52wk Range

    The 52 week range is practically the same as the day’s range: it’s just the range of prices a stock has sold for over the course of the last year. In a volatile market like we’re in now, the day’s range can actually offer better information than the 52 week range because drops and rallies can make it harder to tell what a realistic range for a given stock looks like.

    Volume

    A stock’s volume reflects the total number of shares of that stock that have been traded throughout a single day. If a stock is particularly active, it’s worth checking into why: bad news could have lead investors to unload a particular stock, while good news could send every investor looking for a few shares.

    Avg Vol (3m)

    The average volume over the past three months of a stock is often fairly similar to the stock’s volume over the past day. Knowing the average volume can help you decide when the daily volume is active enough to warrant notice.

    Market Cap

    Market capitalization estimates the total dollar value of the company who’s stock is being traded. It’s determined by multiplying the total number of shares by the last trade.

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    P/E

    Edited: The price to earnings ratio reflects the relationship between the price per share and the income earned per share by the company in which the shares are held. A higher P/E points to a more expensive stock, relatively speaking, because an investor pays more per unit of income.

    EPS

    Earnings per share is the amount of money that you would have earned if you purchased a share of this stock last quarter and sold it today. Right now, many stocks’ EPS are looking grim: it’s a useful indicator of how a stock will do if you plan to sell it in the short term, but if you’re planning to hold it long-term, the EPS is less of a concern.

    Div & Yield

    If you’re looking to turn a profit on stocks, the dividend and yield are probably the first places you look. The dividend is the payment the company pays to shareholders based on its profits. The yield is the dividend expressed as a percentage of the price per share. And while a high dividend is good, an extremely high yield definitely isn’t: extremely high yields can point to a company in some financial trouble.

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    Last Updated on October 15, 2019

    Is Procrastination Bad? The Truth About Procrastination Revealed

    Is Procrastination Bad? The Truth About Procrastination Revealed

    Procrastination is very literally the opposite of productivity. To produce something is to pull it forward, while to procrastinate is to push it forward — to tomorrow, to next week, or ultimately to never.

    Procrastination fills us with shame — we curse ourselves for our laziness, our inability to focus on the task at hand, our tendency to be easily led into easier and more immediate gratifications. And with good reason: for the most part, time spent procrastinating is time spent not doing things that are, in some way or other, important to us.

    There is a positive side to procrastination, but it’s important not to confuse procrastination at its best with everyday garden-variety procrastination.

    Sometimes — sometimes! — procrastination gives us the time we need to sort through a thorny issue or to generate ideas. In those rare instances, we should embrace procrastination — even as we push it away the rest of the time.

    Why we procrastinate after all

    We procrastinate for a number of reasons, some better than others. One reason we procrastinate is that, while we know what we want to do, we need time to let the ideas “ferment” before we are ready to sit down and put them into action.

    Some might call this “creative faffing”; I call it, following copywriter Ray Del Savio’s lead, “concepting”.[1]

    Whatever you choose to call it, it’s the time spent dreaming up what you want to say or do, weighing ideas in your mind, following false leads and tearing off on mental wild goose chases, and generally thinking things through.

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    To the outside observer, concepting looks like… well, like nothing much at all. Maybe you’re leaning back in your chair, feet up, staring at the wall or ceiling, or laying in bed apparently dozing, or looking out over the skyline or feeding pigeons in the park or fiddling with the Japanese vinyl toys that stand watch over your desk.

    If ideas are the lifeblood of your work, you have to make time for concepting, and you have to overcome the sensation— often overpowering in our work-obsessed culture — that faffing, however creative, is not work.

    So, is procrastination bad?

    Yes it is.

    Don’t fool yourself into thinking that you’re “concepting” when in fact you’re just not sure what you’re supposed to be doing.

    Spending an hour staring at the wall while thinking up the perfect tagline for a marketing campaign is creative faffing; staring at the wall for an hour because you don’t know how to come up with a tagline, or don’t know the product you’re marketing well enough to come up with one, is just wasting time.

    Lack of definition is perhaps the biggest friend of your procrastination demons. When we’re not sure what to do — whether because we haven’t planned thoroughly enough, we haven’t specified the scope of what we hope to accomplish in the immediate present, or we lack important information, skills, or resources to get the job done.

    It’s easy to get distracted or to trick ourselves into spinning our wheels doing nothing. It takes our mind off the uncomfortable sensation of failing to make progress on something important.

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    The answer to this is in planning and scheduling. Rather than giving yourself an unspecified length of time to perform an unspecified task (“Let’s see, I guess I’ll work on that spreadsheet for a while”) give yourself a limited amount of time to work on a clearly defined task (“Now I’ll enter the figures from last months sales report into the spreadsheet for an hour”).

    Giving yourself a deadline, even an artificial one, helps build a sense of urgency and also offers the promise of time to “screw around” later, once more important things are done.

    For larger projects, planning plays a huge role in whether or not you’ll spend too much time procrastinating to reach the end reasonably quickly.

    A good plan not only lists the steps you have to take to reach the end, but takes into account the resources, knowledge and inputs from other people you’re going to need to perform those steps.

    Instead of futzing around doing nothing because you don’t have last month’s sales report, getting the report should be a step in the project.

    Otherwise, you’ll spend time cooling your heels, justifying your lack of action as necessary: you aren’t wasting time because you want to, but because you have to.

    How bad procrastination can be

    Our mind can often trick us into procrastinating, often to the point that we don’t realize we’re procrastinating at all.

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    After all, we have lots and lots of things to do; if we’re working on something, aren’t we being productive – even if the one big thing we need to work on doesn’t get done?

    One way this plays out is that we scan our to-do list, skipping over the big challenging projects in favor of the short, easy projects. At the end of the day, we feel very productive: we’ve crossed twelve things off our list!

    That big project we didn’t work on gets put onto the next day’s list, and when the same thing happens, it gets moved forward again. And again.

    Big tasks often present us with the problem above – we aren’t sure what to do exactly, so we look for other ways to occupy ourselves.

    In many cases too, big tasks aren’t really tasks at all; they’re aggregates of many smaller tasks. If something’s sitting on your list for a long time, each day getting skipped over in favor of more immediately doable tasks, it’s probably not very well thought out.

    You’re actively resisting it because you don’t really know what it is. Try to break it down into a set of small tasks, something more like the tasks you are doing in place of the one big task you aren’t doing.

    More consequences of procrastination can be found in this article:

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    8 Dreadful Effects of Procrastination That Can Destroy Your Life

    Procrastination, a technical failure

    Procrastination is, more often than not, a sign of a technical failure, not a moral failure.

    It’s not because we’re bad people that we procrastinate. Most times, procrastination serves as a symptom of something more fundamentally wrong with the tasks we’ve set ourselves.

    It’s important to keep an eye on our procrastinating tendencies, to ask ourselves whenever we notice ourselves pushing things forward what it is about the task we’ve set ourselves that simply isn’t working for us.

    Featured photo credit: chuttersnap via unsplash.com

    Reference

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