Stock prices fluctuate all the time. Hence, monitoring the market is an essential component of investing in stocks as well as share dealing. It is in this regard that people should watch out for the following key market indicators when it comes to this financial transaction.
Stock Quote
This is what people usually see in the screens of their television. This tells people the economics of a certain stock unit of a company. For instance, the quote is usually in the following sequence or formula:
Example:
"COMPANY TICKER" "Current Trading Price" "Unit Change" "Percentage Share"
JPM 37.1 +0.11 (0.30%)
What the example above tells is that the current price of a unit of JP Morgan Chase & Co (JPM) is at $37.10, which is higher by $0.11 or 0.30% from its previous close in the previous trading day.
Historical stock information
There are at least four (4) indicators pertaining to the historical information of a stock. These are the following:
A. Daily high and low - this refers to the highest and lowest selling price of a certain stock in the course of the current trading day. B. 52 week high and low - this indicator refers as well to the highest and lowest selling price a specific stock in the past 52 weeks. C. Previous close - this refers to the price of a stock at the close of the previous trading day. D. Opening price - this refers to the price of the first units of shares of a certain stock during the current trading day.
Total outstanding shares, capitalization and ownership
Total outstanding shares refer to the aggregate number of shares that a certain company has already issued to the market place. On the other hand, market capitalization refers to the current value of the aggregate shares issued by a company. The total number of outstanding shares is multiplied by its current price to get this. Further, the concept of institutional ownership refers to the amount of the outstanding shares that institutions like banks, funds and insurance companies currently own.
Stock beta
This measures the sensitivity of a stock or share to the overall situation of the market or index. For instance, this can be compared to the S&P 500 index as well as other indices. This can usually be found as well in the main chart of the company's quote.
There are two (2) measurements of this indicator that are relevant in share dealing, which are either of the two.
On the one hand, if the stock's beta is over 1.0, this shows high volatility of the stock to the overall market. On the other hand, if the stock's beta is lower than 1.0, this means that the volatility of the price of the company's stock is lower than the overall market. For example, JPM has a current beta rating of 1.31, which means that it is highly volatile.
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