Reading Basic Stock Information
Why is learning this important?
In order to become a smart investor, you must first learn how to read basic stock information and judge how a particular stock is doing. There are many sources for this type of information, from physical newspapers like the Wall Street Journal to websites like Yahoo! Finance or Reuters. I would suggest using the online sites because they can be updated very rapidly, whereas a newspaper only comes out once per day.
Tickers
Savvy investors know their portfolio of stocks very well, and they also know the tickers for each stock. A ticker is an abbreviation for a stock, usually three or four letters long, that is the stock's name on the trading floor. For example, Target Corporation is TGT, Wal-Mart Stores is WMT, and Microsoft Corporation is MSFT. Tickers allow you to find the company's stock quickly and efficiently, so it would be a good idea to memorize the tickers for the companies that you are often watching.
Real Time Stock Charts
Many sites like Yahoo! FInance offer real time stock charts. In essence, these are very convenient graphs that depict the movement of the stock price over time, in a period anywhere between 24 hours to several years. For example, the following is a 24-hour real time stock chart for Google for May 31, 2006 from Yahoo! Finance.
Stock Data
It is important to learn how to read stock data. There are many useful metrics such as the price, P/E, EPS, and other ones that are important to learn. I will go over those more in the section entitled "Stock Metrics." The following is an example of a table, so that you have a better idea of what one looks like. This is Johnson and John on May 31, 2006 from Yahoo! Finance.
