How to Read Stock Quotes

Video Transcript

"If you pick up your local newspaper or go online, typically you see a series of numbers. One number is going to be what the sellers want for their shares, and another number might be what the buyers are willing to pay, and then the next number, typically, is the volume or the number of shares that have traded during that day. Now, if you're reading about it in the newspaper, generally those stats are pretty limited. They'll have the price that people are trying to sell their stock at, and then the price that people are willing to pay for that stock. Maybe what the yield is, maybe what the volume is, sometimes less. If you go online, frequently you'll get more statistics. Yes, you'll get the price that people are trying to sell their shares at, and perhaps the price that people are willing to buy their shares for. Maybe you'll get dividend yield and volume. And then maybe you'll get some value stats. What the price earnings multiple is, or price to cash flow, or maybe they talk a little bit about debt in there. And in some cases, they'll also give you a list of all of the different types of stocks or bonds that you can buy under that specific company. Why is that important? Because the first decision is find the right business. The second decision is find the right way to buy it. I'm Roger Groh with Groh Asset, and thank you very much for spending time with me."