How to Read Stock

Purchasing stock is a good way to invest in a business's future. Stock is actually small bits of the company. So purchasing stock gives you a chance to gain wealth or lose your investment. Although it may seem that buying stock may seem like a wild gamble, it is not. If you know how to read stock correctly you can easily determine what a good investment is. It is really easy to read stock.

Things You'll Need

• Newspaper

Instructions

1. Understand what all the stock terms mean. The following is an explanation of the terms you may see: A 52-week high is the stock's closing high price from the last year. A 52-week low is the stock's lowest closing price from the last year. Stock refers to either the stock name or an abbreviated version of the stock name. DIV is the annual dividend the company has paid. If left blank, the company does not normally pay dividends.YLD % is based on previous day's close, what percent return a stockholder could expect to receive. PE is the Price to Earnings ratio (P/E). VOL 100s refers to how many hundreds of shares were trade the previous day. Hi is the stock's highest price for the previous day. Lo is the stock's lowest price for the previous day. Close is what the stock closed at the previous day. Net change is the stock's change in price from two day's close to yesterday's close.

2. Understand how to find the stock. All stocks will be broken into different market. When looking for stock, determine if it will be listed on the NSYE, NASDAQ, AMEX or a smaller exchange.

3. Look for asterisks or footnotes. If there is any special notation, these notations are normally explained at the bottom of one of the beginning stock pages.

4. Know when to look to read the stock report. Some papers will only post the stock reports every week while some post everyday. When looking to purchase stocks, it is best to have to most current information.