How to Read Stocks and Actually Understand Them

by: CarlieEviee
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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.

Let's look closer at the table. You'll notice that there are twelve columns in the table; each stock has a line of its own. Let's examine the first two columns, which are usually named something like "52W High" and 52W Low." These tell you about the stock's performance over the last year. The names are pretty suggestive; "52W High" reveals the highest value the stock has reach in the past 52 weeks. Its lowest value shows up in the "52W Low."

The next column is the name of the stock itself, followed by another column showing the stock's ticker symbol. Every stock is given a unique combination of letters. Perhaps you'll even recognize a few (or more than a few) of these tickers. They periodically run across the bottom of the screen of cable news networks.

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.

Next to the ticker column is a column labeled "Div." This indicates the stock's annual dividend paid out per share. Many rows will have this column blank, which means they don't currently pay out dividends. The same goes for the next column - "Yield %" - the percentage return on the dividend.

P/E is the price to earnings ratio. Dividing the current stock price by earnings per share for the last four quarters gives you this number.

After that you will discover the columns of "High" and "Low." These are the highest and lowest points that the stock reached in the day's trading. "Net Change" refers to how much the stock price has changed from the previous day, and "Close" lets you know what the final price was when the stock market 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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