How to Read a Stock Market Table and How Stocks Are Sold

How to Read A Stock Market TableAs mentioned above, many Americans invest in the stock market.  How do they know how the stocks they invested in are doing?  They can look in the business section of a daily newspaper or check on a number of online sites.  Below is a description of the columns in a stock market table as you read a stock market table from left to right.

52 Weeks (Hi and Lo)-  These two columns list the highest and lowest price of the stock over the past year.

Name-  This column describes the name of the business.

Symbol-  This is the symbol for the company’s stock.  Useful for quick reference.

Dividend.  This column describes any dividend paid over the previous year on the stock.

Yield.  This represents the dividend as a percentage of the stock’s price.

PE (Price Earnings Ratio) – the price of a corporation’s stock divided by the amount the corporation earned per share over the past year.

Volume-  This column describes the number of shares of a stock traded on one day.  It is expressed in 100’s.   Which means to know the exact amount of stock traded, you need to add two zeros to the number in the column.

Hi  and Lo –   The numbers in these columns show the highest and lowest prices offered for the stock on that day.

Close –  Describes the last price at which the stock traded when the bell to close the exchange sounded.

Net Change – Describes the change in the closing price compared to the closing price of the day before.

 

Click on the link below to see a sample stock market table.

Reading a Stock Market Table

 

The Steps Involved in Purchasing Stock

Let’s say that you are interested in purchasing some General Motors (GM) stock.  You would then follow the steps below.  Much of what happens below, occurs “behind the scenes”.

  1. You place the order with your broker to buy 100 shares of General Motors stock.
  2. The broker sends the order to the firm’s order department.
  3. The order department sends the order to the firm’s clerk who works on the floor of the exchange where shares of General Motors are traded (the New York Stock Exchange).
  4. The clerk gives the order to the firm’s floor trader, who also works on the exchange floor.
  5. The floor trader goes to the specialist’s post for General Motors and finds another floor trader who is willing to sell shares of General Motors.
  6. The traders agree on a price.
  7. The order is executed.
  8. The floor trader reports the trade to the clerk and the order department.
  9. The order department confirms the order with the broker.
  10. The broker confirms the trade with you.

 

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