How to Watch Stock Trades
Seasoned investors watch price and volume movements of particular stocks as a tool in making their own decisions to buy, sell or hold a position in a particular company. Unusual stock trades are often a sign that something is going on with the company. Understanding what is happening creates opportunity for investors either to increase their ownership of a particular stock, unload it or hold steady and perhaps go for a ride.
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Instructions
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Learn about a company before you begin to watch its stock trading. Understanding a company's business, how it makes money, past performance, competing forces, demand for its products or services -- all of these factors give you a deeper knowledge of how the marketplace values a particular company.
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Visit an investment website such as marketwatch.com and read daily news reports, follow several different stocks, and consider the opinion and analysis information. Investment websites will give you a good overview of how the market is performing during the day and what factors may be driving it up or down. This gives you a valuable context on the broader markets when evaluating a particular company's stock trading.
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From an investing website, enter the stock symbol for the company you wish to track during the trading day. For example, WalMart trades on the New York Stock Exchange under the ticker symbol WMT. Once the symbol is entered, you will be able to watch trading activity in WalMart for as long as the market is open on that particular day.
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Look for sudden fluctuations in the stock price such as a rapid climb or fall of more than 4 percent, then check stock news sites to see any developments or announcements have gone down. Ideally, you'll have a web browser open for tracking a stock and another open to an investment and market news site, where you can follow daily announcements.
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Set your news site to follow news about the company you are watching. For example, enter WMT in the proper field on a site such as Yahoo Finance to read news and scan company announcements from WalMart during the day.
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Mark anticipated company announcements on your calendar, including a note on when the company provides quarterly earnings announcements. Most publicly traded companies report earnings within a few weeks after the end of each quarter on March 31, June 30, September 30 and December 31. You'll want to be ready for the announcement, as a company's stock price can shift dramatically within seconds of an earnings announcement.
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Look for high-volume trades or a large number of trades in a short time, as well as price movement up or down. This indicates someone has knowledge of something going on at the company. The definition of "large" depends on the volume of stock the company has issued, although a reliable gauge is to measure the current trading volume against the average daily trading volume, which will be listed on investment sites with other vital statistics about a company's stock.
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