Investing Done Right: Smart Investing for Financial Freedom by Martin Jablonski

Author:Martin Jablonski [Jablonski, Martin]
Language: eng
Format: epub
Publisher: Defy Ordinary
Published: 2017-03-02T08:00:00+00:00

Understanding the Fundamentals of Stock Quotes

An essential strategy in choosing profitable stock options is being able to interpret a stock quote and define whether an investment fits your criteria. Numerous websites online offer the convenience of searching through hundreds of thousands of stock quotes in addition to supporting information such as news and charting that will be used for your investment research. You can also look in the newspaper for supplementary information on company stocks. Instead of leaving the success of your portfolio up to chance, take the time to read and interpret each stock quote for the company shares that you are considering.

First, the company name is listed so you can take note of which company you are considering to conduct more thorough research on their mission, industry and past performance. Each company has a unique ticker symbol which is what shows up on financial TV. Take note of the ticker symbol on each stock quote as you will be able to research more information on the company before making a decision. The type of stock will indicate whether it falls under the category of common or preferred stock. Preferred stocks will normally list out a dividend per share, so you will have a pretty good idea of how much each stock pays out.

The stock quote lists the opening price of the stock share, the "bid" which highest current price and the "ask" that is the lowest price an individual will set it for. You also want to look at the 52-week range which represents the lowest and highest price that stock traded for over a year timespan. You can tell the popularity of a particular stock by looking at the volume which represents the number of shares sold within the current session. Make sure you compare the average volume of shares traded per day to the current volume to get an accurate picture of whether the volume is unusually low or high.

The market cap represents the total value of each company which accounts for all of the shares combined. If a company has 2 million shares trading at $50 per share, the total market cap would be $100 million. Often companies with smaller market caps are riskier than large caps because they have fewer assets to protect themselves in the case of financial hardship. Although smaller companies can play a valuable role in your portfolio because they have historically generated higher returns. The largest 5 percent of all stocks are considered large cap while 80 percent represents the smaller cap stocks. Right in the middle of the size scale are mid-cap stocks representing 15 percent of all stocks. Large cap stocks range between $10 to 200 billion, mid-cap between 2 and 10 billion and small cap stocks ranging from $300 million to 2 billion. Anything over the $200 billion large cap is mega cap and below small cap under 300 million is micro cap. You should have a range of stocks with different sized caps in order to balance out the risk between small and larger companies.

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