What Is a Stock Quote?
A stock quote is the price of a stock as quoted on an exchange. A basic quote for a specific stock provides information, such as its bid and ask price, last traded price, and volume traded.
Key Takeaways
- A stock quote is the price of a stock as quoted in decimals on an exchange.
- A stock quote is generally displayed with supplemental information, such as high and low prices for a given security in a day or its change in value.
- Pricing displayed with a stock quote reflects the buying and selling activity that influences the value of a given security.
Understanding Stock Quotes
All stocks in the U.S. have been quoted in decimals, rather than fractions, since April 9, 2001. As a result, bid-ask spreads have contracted dramatically, with spreads for the most widely traded stocks now as small as a penny, compared with 1/16th of a dollar (or $0.0625) earlier. Decimal pricing has resulted in substantial savings on transaction costs to U.S. investors because of tighter bid-ask spreads.
Investors increasingly access stock quotes online or on mobile devices, such as smartphones, rather than through print media, such as newspapers and magazines. A large number of Internet portals and websites offer delayed stock quotes at no charge, with real-time stock quotes generally restricted to paying subscribers.
Stock quotes can be presented with supplemental information and data, such as the high and low prices for given security that have been recorded over the course of the trading day. It may also show the change in the value of the security compared against the prior day’s closing price or the opening price of the current trading day. This difference in price might be shown as a percentage, revealinghow much security has increased or declined in value. Analyst recommendations for a given security might also be presented with a stock quote. Such recommendations could be shown for hourly, daily, weekly, and monthly intervals.
Consider the stock quote for the social media behemoth Meta (formerly Facebook). It is displayed along with supplemental information: the company's ticker symbol (META), change in price (expressed in terms of percentage), and last quoted price at closing time.
Depending on the service and platform providing stock quotes, the information might strictly revolve around the current, latestpricing, or there can be expanded details such as metrics on the daily, weekly, monthly, and annual performance of the security. A stock quote can also include performance metrics on share prices for a multi-year period.
The pricing displayed with a stock quote reflects the buying and selling activity that influences the value of a given security. As each trading day unfolds, news and industry trends related to a security can affect the way investors choose to handle the shares. When beneficial updates are revealed, such as strong revenue and earnings reported by the company or positive test results for a product, the value of the shares can increase as more investors buy into the company. These shifts are reflected in the stock quotes that shareholders and other watchers of the company will use to makeinvestment decisions.
FAQs
A stock quote is essentially the price of a stock or equity security that is quoted on an exchange. The stock quote provides key pieces of information to be used by traders and brokers. It includes information regarding the bid price and ask price, the last traded price, and the volume traded in the day.
How do you read a stock line? ›
The horizontal hash mark shows the price where the stock closed for the day. The color of the price bar indicates whether the stock closed up (blue) or down (red). Moving Average Lines: The red line shows the average share price during the last 50 days (on a daily chart) or 10 weeks (on a weekly chart) of trading.
What is the easiest way to explain stocks? ›
A stock represents a share in the ownership of a company, including a claim on the company's earnings and assets. As such, stockholders are partial owners of the company. When the value of the business rises or falls, so does the value of the stock.
How to read the stock market for beginners? ›
Each trading day is represented as a bar on the chart with the open, high, low and closing prices. The length of the bar shows the stock's price range for that day, with the top of the bar representing the highest price and the bottom the lowest price for the trading day.
How to interpret stock prices? ›
Open: This amount refers to where the stock's price opened for trading on that given day. High/low: These numbers are the highest and lowest prices that the stock traded at on that day. Market cap: This figure refers to the company's market capitalization, or the value of all the company's outstanding shares.
How to read bid and ask size? ›
The bid price represents the highest price a buyer is willing to pay for the security, while the ask price represents the lowest price a seller is willing to accept. In the stock market, a buyer will pay the ask price and a seller will receive the bid price because that's where supply meets demand.
What is stock in simple words? ›
A stock is a security that represents a fractional ownership in a company. When you buy a company's stock, you're purchasing a small piece of that company, called a share. Investors purchase stocks in companies they think will go up in value. If that happens, the company's stock increases in value as well.
What is stock simple with example? ›
Simply defined, a stock is a financial instrument which represents partial ownership in a company. If a company has 1000 stocks and someone holds 400 stocks, this represents 40% ownership in the company.
How do you read a good stock? ›
The shadows above and below the body represent highs and lows during the interval. A short upper shadow on a red candle means that the stock opened near the high of the interval but closed lower. On the other hand, a short upper shadow on a green candle means that the stock closed near the high of the interval.
How do you read stock results? ›
Basic stock chart terms to know
The open is the first price at which a stock trades during regular market hours, while high and low reflect the highest and lowest prices the stock reaches during those hours, respectively. Previous close is the closing price of the previous trading day.
Verify the activity in your account: • Identify the time period covered by the statement; • Find your beginning and ending balances; • Verify withdrawals and additions to your account; • Identify dividends and interest received in your account and understand the source (i.e., the specific security investment) of that ...
How do stocks work for dummies? ›
The stock market helps companies generate funds for their operations. Companies, usually those that plan to go public, list their shares on the stock market, inviting investors to purchase the shares. Stock market transactions are mostly done through stock exchanges.
How do stocks work in layman's terms? ›
A stock is a financial security that represents an ownership interest in a company. Stock shareholders have a proportional claim on a company's net assets and future earnings. Publicly-traded stocks have a history of high returns, but they expose investors to a lot of near-term risks.
How do you explain trading to a beginner? ›
You can trade rising and falling prices
You'll buy (go long) if you think the asset's price will rise, and sell (go short) if you think it'll fall. So, if you go long and the price rises, you'll make a profit – but if it falls, you'll make a loss. The opposite is true when you open a short position.
How do you read stock price numbers? ›
Open, high, low and previous close. The open is the first price at which a stock trades during regular market hours, while high and low reflect the highest and lowest prices the stock reaches during those hours, respectively. Previous close is the closing price of the previous trading day.
How do you read stock options quotes? ›
How to read call and put options
- Root Symbol: The root symbol represents the underlying asset. ...
- Expiration Date: Indicates when the call option expires, expressed as a year, month, and day (e.g., "20231217" for December 17, 2023).
- Strike Price: Specifies the price at which the option holder can buy the underlying asset.
In the wide world of stocks, "volume" represents the number of shares traded during a defined period, typically a day. You'll often see the full term spelled out, too. When you're looking at the stock market, "volume" is the same thing as "trading volume."
