How to Read the Stock Market for Dummies

Stock market chart

If you have just received an inheritance of stocks or are looking to jump into the stock market yourself, you need to understand the basics of how to read stock market information. Although the business section can appear extremely complicated when you flip to the stock page, each stock quote is only made up of a few different tidbits of information. Once you know what all the symbols mean, you shouldn't have an issue determining the value of your stocks.

Instructions

1. Look up the particular stock you want to check out. If you do not know the ticker symbol for the product you should go online for this. Most newspapers only feature the stock ticker symbol and not the actual product name. You can use a site such as Yahoo Finance, CNN Business or ETrade for this information (see Resources).

2. Type the name of the company in the search bar and you are given the stock ticker symbol. This is the symbol all traders use to invest in a particular company. Only one company can have the ticker information, so as long as you know the symbol (usually anywhere from one to five letters) you shouldn't have a problem looking it up.

3. Type in the symbol into the stock symbol option and click "Search" (you can also now look this information up in the newspaper). The previous day's trading information appears on the screen.

4. A number with a "+" next to it means the stock gained over the previous day, increasing its value. A "-" next to it means the stock lost value over the previous day. Each gain or subtraction is off one share. For example, if you own one share of a company worth $50 one day, then you check the paper and see it increased +.15. It means the stock when up 15 cents to $50.15 a share. If you have multiple shares of the same company, you multiply this by the number of shares you have. So if you have three shares of this company, the value of your portfolio went from $150 to 150.45.

5. Look for the percentage next to the stock. This shows you the percentage of change the stock went through the previous day. If the stock is up and it reads (2.5 percent) it means the entire value of the stock increases 2.5 percent. Likewise if the stock is down 2.5 percent, the value lost 2.5 percent of its overall worth.

References

• Yahoo: Ford Stock Information and Example

Resources

• Yahoo Finance: Stock Quote
• CNN Business: Stock Quote
• ETrade: Stock Quote