Understanding a Stock Quote the easy way
A stock quote is a summary of trading information about a company. It is a first glance of a company's stock trading history and other indicators.
Let’s take a look at Apple's stock quote:
As you can see you will find several elements on a stock quote. All these elements are quite easy, no worries.
Let's start in order.
Previous Close or Closing Price: It refers to the last price at which a stock trades during a regular trading session. In the U.S., the trading sessions run from 9:30 a.m. to 4:00 p.m. EST.
Open: The opening price is the very first price that a stock is traded at when the markets open.
High: The High is the highest price someone pays for that stock during a market session on a particular day. Note that this High can change during the session until its end.
Low: This refers to the cheapest price a stock reaches during a market session on a particular day. As it happens with the High price, the Low prices can change during the session until its end.
Volume: This refers to the number of shares traded or change hands during the market session.
Average Volume: Taking the aggregate Volume for a certain period and dividing by the number of days, we can calculate the Average Volume for a stock. Average Volume usually is usually displayed as a monthly figure. Comparing them we can determine if something is happening to that stock.
Unusually high volume for a current session, in comparison to the average daily volume, can indicate big news about a company. Why? If the expectation of a company has changed or there is any news about the company (good or bad), investors' perception of a company's value changes, therefore more shares change hands.
We can see this happening when a company releases an earning report that misses investor's expectations. Also, when companies make big unexpected announces.
MKT CAP or Market Capitalization: Refers to the value of a company. It is calculated as the number of outstanding shares times the price per share at that time. In this example, Apple has a market cap of $827 Billion.
52 Week High: This is the highest price of a stock in the last 52 weeks.
52 Week Low: This is the lowest price of a stock in the last 52 weeks.
Comparing both 52 weeks high and low prices with the current price we can help you determine the evolution of the stock price and see why it moves the way it does. In this case, Apple is trading at $160.13 which is very to close to its 52 week high.
We will consider all these factors in the next post where we will break down a company stock analysis.