How To Read A Report On Stock Market


A screen shot of a computer

If you are new to the world of trading, it is essential that you get your basics right before you take the plunge. The report on stock market is something you will be dealing with every waking moment. And, it is essential that you know how to read it right! So, what are the basic pointers? How do you make head or tail of this report? Let’s find out. 

Know The Stock Chart

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The stock chart is the most important thing when you are trading. This contains all the information available on the stock of the company. The table will tell you about the current trading price, price changes, historical highs and lows, trading volume, dividends, and plenty of other company financial information. You will have to know what to look for in order to make the best possible prediction. 

52-Week High And Low

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When you are entering the stock market for the first time, you need to know about how the stock has performed historically. The 52 week high and low result will give you the highest and the lowest price that the stock has traded within one year. This is a key metric that allows you to understand the viability and profitability of a stock. It, however, will not contain the previous day’s price. 

Ticker Symbol

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This is the symbol, basically a group of letters, that represents the stock in the stock exchange. For example, Apple’s ticker is AAPL, while Microsoft uses MSFT. 

Dividend Per Share And Divided Yield 

Dividend is the essential pay from the profit to the stockholders. Dividend per share and the annual dividend per share is represented in the stock chart for the companies that pay dividends. Take note, this is not done by every company. 

Dividend yield is the percentage return on the dividend, and is calculated by dividing the annual dividend by the current stock price. 

P/E Ratio

The price to earnings ratio is calculated by dividing the current stock price by the earning per share for the past year. 

Open Price And Close Price

Open price is the price at which the stock is valued at the opening time of the stock market. The close price is the price at which the stock was traded last at the time of the closing of the market. There is after-hours trading can also affect the pricing of the stock. 

Closing price is the price at which the stock was last traded at the time of closing of the stock market. A higher closing price than opening price means the stock is in positive. The reverse means negative. These are shows in the chart. 

Net Change 

It is the dollar value change in the stock price since the opening price. A positive net change means that the stock’s price increased in the day and negative means that the price fell. 

How To Read Stock Chart

The stock chart is represented by a line that is plotted against the price and time axes. It shows how the stock price went with time through the trading day. If you wish to start trading, you will have to know how to see trends. Upward or downward moving lines are easy to understand. But, if you see a high volume of trading, which is shown at the bottom of the chart, then you can deduce that the trend in the given direction is strong. 

Stock market trading is risky, and there is no single trader who has never seen loss. But, you will have to invest in order to become better at this. And, never be demotivated by a loss. Even a loss gives an opportunity.

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