May 11, 2008

How to Read Stocks With These Simple Tips

by Carlie Eviee

When you're first learning about the stock market, the stock tables in the paper can be quite confusing. Learning how to read stocks won't take much time, though, and it's very important.

To begin, you'll notice that there are about twelve columns across the table, and each stock has its own line. The first two columns (usually labeled something like "52W High" and "52W Low") are dealing with the stock's performance over the past year. "52W High" shows the highest point the stock has reached in the past 52 weeks, and "52W Low" shows the lowest.

In the following column you'll see the actual name of the stock. This will be followed by another column that shows the stock's ticker symbol. There's a unique combination of letters for each stock. In fact, you might be able to recognize some of them. Maybe you've seen the tickers running across the bottom of the screen when you watch the news.

Speaking of which, watching the financial shows on these networks will give you further help on how to read stocks and other aspects of the stock market.

"Div" is the column that comes after the ticker column. From this column, you see how much in annual dividends the stock pays out for every share. You'll know the stock doesn't pay out dividends if this particular column is blank. The percentage return on the dividend shows up in the "Yield %" column, though it too will be blank if the stock doesn't pay out dividends.

The earnings ratio is indicated by P/E. You get this number by dividing the current stock price by the earnings per share for the last four quarters.

"High" and "Low" are the next two columns. You'll be able to see the lowest and highest point the stock has reached in the day's trading. "Net Change" shows the change from the day before; "Close" tells you the point when the stock closed for the day.

With a basic understanding of how to read stocks, you can now move on and start learning more about the market itself.

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