| While most folks today trust mutual funds and | | | | abbreviated symbol that the stock market uses |
| their professional managers with their | | | | to identify your company. For example, GE is |
| investments, it's still important to | | | | General Electric, WMT is Walmart. Once you |
| understand the basics of the stock market. | | | | select a company, you'll need to know it's |
| Although investing in individual stocks may | | | | shorthand name to track its progress. |
| not be right for everyone, a basic | | | | |
| understanding of the stock market is | | | | Second, the company's name may be listed. |
| essential to understanding the workings of | | | | Some tables omit the name to save space, |
| our economy and business sector. | | | | others list it to make tracking stocks |
| | | | easier. |
| A stock is a portion of ownership in a | | | | |
| company. Commonly referred to as a share, it | | | | The third item is the number of sales in the |
| is a small percentage of the total ownership | | | | last trading day. This is listed in the |
| pool for the corporation. Shareholders are | | | | 100,000's, so 256 means 256,000 shares were |
| stock owners, or people who have an ownership | | | | bought and sold on the last day that the |
| interest in the corporation. Today, shares | | | | market was open. |
| are usually tracked electronically, but in | | | | |
| previous decades shareholders would actually | | | | Next are the high and low price, in that |
| receive a certificate stating their | | | | order. The high price is the highest per |
| ownership. | | | | share price that the stock sold for on the |
| | | | previous trading day. The low price is the |
| Why own stocks? First, you are sharing in the | | | | lowest price for that day. Since the price of |
| company's profits. When a corporation shows a | | | | the shares moves all day long, this is a good |
| profit, they will sometimes distribute these | | | | reference to see how much the stock is |
| profits to each shareholder, based on how | | | | changing in a day. |
| much stock they own. This distribution is | | | | |
| called a dividend. Company's can elect to pay | | | | Next, the closing price is listed. This is |
| out their profits or reinvest them in the | | | | the last price that the stock traded for as |
| company, but as a shareholder, each time a | | | | the market closed. This will also be the |
| payout is made you will receive your | | | | beginning price for the next trading day. |
| proportionate share. | | | | |
| | | | After the closing price, the table will list |
| Also, the value of your stock will rise and | | | | the change, or the amount that the stock |
| fall based on the company's perceived value | | | | changed when you compare yesterday's closing |
| in the stock market. If you buy a share at | | | | price with the closing price for the day |
| $10.00 and it rises to $11.00 a share, you've | | | | before. This will be listed as a positive |
| made a dollar for each share you own, and | | | | number (the stock went up) or a negative |
| subsequently sell. However, with this | | | | number (the stock sold for less yesterday |
| opportunity comes risk as well. If the share | | | | than the day before). |
| price falls and you sell, you'll lose money. | | | | |
| The more volatile the stock, the more | | | | Stock tables are found in many places, but |
| opportunity for risk or profit. | | | | most people check their daily paper or the |
| | | | Wall Street Journal. There are many internet |
| Most shareholders track their stocks using | | | | sites that track stocks as well. |
| the stock table. These appear confusing and | | | | |
| difficult to read, but they are actually easy | | | | Of course, you'll have to select a stock. |
| to understand with a little practice. | | | | Choose carefully or consult a professional, |
| | | | and good luck! |
| Ticker symbol is listed first. This is the | | | | |