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How to read stock quotes: 20 terms you should understand

How to read stock quotes

You often see stock quotes on BSE and NSE billboards, news channels, or on google when searching for stock information.

When you need information about companies stock price, you search on google and it shows a stock quote.

If you don’t understand how to read stock quotes, then it would be difficult for you to get a quick overview of the company’s information.

A stock quote is the current price of a stock quoted on an exchange.

Stock quotes consist of various components, so understanding how to read stock quotes is essential for you.

How to read stock quotes

1. Last price

It is the most recent price of a stock. On market hours it fluctuates constantly and remains constant when markets are closed.

This is the price of 1 share of a company.

2. Today’s change

It is the change in price from yesterday’s price. It also states in percentage.

3. Symbol

When a company is listed on the stock exchange, it selects a symbol that represents a company. The symbol is just an identity of a company in a stock exchange.

4. Stock chart

The stock chart shows the price trend of a company. You can see the price trend of 1 day, 5 days, 1 month, 6 months, 1 year, 5 years, and max.

5. Bid

The highest price a buyer is willing to pay per share

6. Ask

The lowest price a seller is willing to sell per share

7. Today’s low

This is the lowest price stock has been traded during the day.

8. Today’s high

Today’s high is the highest price stock has been traded during the day.

9. 52 week low

52 week low is the lowest price stock has been traded during the last 52 weeks.

10. 52 week high

52 week high is the highest price stock has been traded during the last 52 weeks.

11. Open price

Open price is the price at which the stock price is started trading during the stock market opens.

Every day when the market opens the starting stock price of a stock is open price.

12. Previous close

The previous close is the price of a stock at which the stock ends trading when the stock market closes.

13. Volume

Volume is the total number of shares trading, bought and sold, during the day. The stock quote also shows you how much people are bought and sold the stock during the day.

14. Value

Value is the value of stock traded( bought and sold) during the day.

15. Beta

Beta is the volatility of a stock compared to the whole market. It is the numerical value that states how company stock price would react from the effect of the whole economy.

A beta greater than 1.0 indicates that the stock is more volatile than the whole market, and a beta less than 1.0 states a stock with lower volatility.

Knowing how to read stock quotes will let you know a lot of information about a stock.

16. Price to earnings ratio

The P/E ratio is one of the popular ratios in the stock market. P/E ratio measures the company’s current share price to the earnings per share.

A high P/E ratio indicates the company is overvalued and a low P/E ratio indicates the company is undervalued.

Most analysts use this for the same reasons or use it for comparing company to company.

17. Market cap

Market capitalization is the value of a company on the stock market, calculated by the total number of outstanding shares by its current per-share price.

Read more: Market Capitalization: Basics & Categories

18. Dividend

A dividend is a profit of a company attributable to its shareholders. In two ways you can make money in stocks, the dividend is one way of it, other is stock appreciation.

19. Dividend yield

The dividend yield is a financial ratio that measures a stock’s dividend payout in proportion to its share price.

20. Earning per share

Earning per share (EPS) is a company’s profit per outstanding share of stock. It will tell you how much you’d earned per share.

Conclusion

Now you know how to read stock quotes. From now it would be easy for you to get a quick overview of stock information.

Knowing how to read stock quotes is great and practicing what you just read is greatest.

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