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How to read stocks
#1
The stock quote gives plenty of insight into the company. Understand how to read this information in order to make better purchase decisions.

When you look up a stock quote, there a variety of numbers, prices and diagrams that will appear. Understanding what they all mean will help you make an informed decision when purchasing a stock.

Learning about stocks and how they work is essential to achieving strong investment returns and will allow for significant financial advantage.

Here is the elements of a quote page you need to read stocks:

It is important to use a website that can provide all of this when looking up a stock. I would suggest https://za.investing.com/equities/ or https://www.google.com/finance as both these options are free. 

Tip: The investing.com app also has a very nice Watch-list function and provides all the info needed to read a stock as well.

  1. Last Price
    The most recent price that the stock has traded at. The last price, however, is not the price you will be paying for the stock.
  2. Bid
    The highest price a buyer is currently willing to pay for a stock.
  3. Ask
    The lowest price at which a seller is currently willing to sell the stock at. When placing a market order, you are buying or selling a stock at the best available price.
  4. Today's Change
    The change in price (and the percentage change) compared to yesterday's closing price.
  5. Previous Day's Close
    This is the price of the stock for the last trade of the previous day.
  6. Today's Open
    The first price at which this stock traded when the markets opened this morning. Note that stocks do not open at the same price that they closed at the day before due to after hours trading.
  7. Volume
    This indicates the number of shares that have traded hands today. Some stocks may trade millions of shares each day, and others only trade a few hundred or even zero (the higher the volume, the more liquid the stock is).
  8. 52 Week High
    This is the highest price the stock has traded at during the last 52 weeks.
  9. 52 Week Low
    This is the lowest price the stock has traded at during the last 52 weeks. The 52 week high/low allow you to compare the current price to its 52-week range.
  10. Charts
    Stock charts come in a variety of formats and have a whole investing technique based around them. They all track pricing data, usually the OHLC (open, high, low close), but they can display this information in different styles (lines, bars, candlesticks), different date ranges (day, week, month, year, 5 years, 10 years) and other information like volume, moving averages and dozens of other indicators.
  11. Annual Dividends
    The amount, in dollars, the company will (but not obligated) pay to shareholders on a regular basis (usually monthly or quarterly).
  12. Annual Dividend Yield
    This is an important measure of return of the stock and is calculated by dividing the annual dividend amount by the current stock price. If the stock is at $10 and the company pay out a cash dividend of $0.50 per share, then the annual dividend yield is 5%.
  13. EPS
    Displays the company's earnings (profit) per share. It is calculated by dividing the company's most recent annual income by the number of shares outstanding.
  14. Market Cap (aka Market Capitalization)
    Is the total dollar market value of all of a company's outstanding shares. Market cap is calculated by multiplying a company's shares outstanding by the current market price of one share. This figure determines the company's relative size.
  15. Price-Earnings Ratio (P/E)
    Is the ratio for valuing a company and measures its current share price relative to its per-share earnings.
  16. Beta
    Is used to measure the volatility of a stock as compared to the market as a whole. A beta of 1 means the stock moves up or down more quickly than the market overall; a beta between 0 and 1 means the stock doesn't move as much as the market, and a negative beta means the stock moves in the opposite direction of the market.

#2
Very nice.

/bookmarked now u have all this in one place for future reference.
Register on Platinum Wealth (My referral link)

#3
Hi just on the Beta.
I thought 1 was the same as the market. Below 1 was a return less than the market and above 1 was a return above the market. Obviously this depends on the time beta was measured over. Is there a standard period for a beta measure?

#4
(02-27-2017, 03:48 PM)Ianf Wrote: Hi just on the Beta.
I thought 1 was the same as the market. Below 1 was a return less than the market and above 1 was a return above the market. Obviously this depends on the time beta was measured over. Is there a standard period for a beta measure?

I hope this makes more sense:

Quote:A beta of 1 indicates that the security's price moves with the market. A beta of less than 1 means that the security is theoretically less volatile than the market.

A beta of greater than 1 indicates that the security's price is theoretically more volatile than the market. For example, if a stock's beta is 1.2, it's theoretically 20% more volatile than the market. Conversely, if an ETF's beta is 0.65, it is theoretically 35% less volatile than the market.

Therefore, the fund's excess return is expected to under perform the benchmark by 35% in up markets and outperform by 35% during down markets.

From: http://www.investopedia.com/terms/b/beta.asp

#5
Thanks i was mixing up Alpha and Beta






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