How to Make Money From Poker Without Playing a Hand - II
You know your basics and you’re ready to start trading. But before you start hollering “Buy! Sell! Hold!” into your mobile phone, let’s learn a little more about how to read those meaningless stock info summaries on the finance pages. We will use the well-known Cryptologic software stock as an example.
At the time of writing, these were the stats for CRYP in Yahoo Finance:
Last Trade: 16.74 $——–Day’s Range: 16.50 - 16.86
Trade Time: 8:55PM———52wk Range: 16.51 - 31.20
Change: (UP)0.03(0.18%)—-Volume: 66,361
Prev Close: 16.71———-Avg Vol (3m): 72,336.2
Open: 16.55—————-Market Cap: $232.60 M
Bid: 15.86×100————-P/E: 77.86x
Ask: 17.67×100————-EPS : 0.22$
1y Target Est: 24.50——-Dividend: 0.48$/2.80%(14-Dec-07)
Left column, from the top:
Last Trade: last price at which the stock was traded, i.e. its current value in the market. If you look at stock info online with streaming quotes, you can see this change before your eyes.
Trade Time: this is, quite simply, the time of the last trade.
Change: amount and percentage the value has changed since the market closed last night. In this case you can see it’s gone up 3 cents, from the previous closing price of $16.71 to the current one of $16.74.
Prev Close: price when the market closed last night
Open: Price at which it opened in the morning. Interestingly, it is not the same - analysts calculate it afresh every morning based on market conditions, and it may be influenced by company news released after the stock market closed the previous day.
Bid: the name says it - the best price someone is offering and the amount they want. In this case, someone is willing to buy 100 units at $15.86.
Ask: the same but for sellers. When these two numbers match, voila, you have a transaction!
1y Target Est: an expert’s estimate of what the price will be in a year. This can be calculated in several ways, and estimates may vary from one expert to another.
Right column, from the top:
Day’s Range: lowest and highest prices at which the stock has been traded so far in the day.
52wk Range: same, but for an entire year.
Volume: number of transactions so far in the day. It works like this: If you sell 100 actions it means somebody bought 100 actions from you, so the volume adds up to 200.
Avg Vol (3m): the average of the daily volume for the past 3 months.
Market Cap: this is the current value of all the stock available. The Market Capitalization is calculated by multiplying the Last Trade price by the current number of shares outstanding.
P/E: this is the price-earnings ratio, and a way to measure the value the market places on a certain stock. It is calculated daily by dividing the last closing price by the EPS (earnings per share.) The highest
EPS: the “earnings per share” ratio is an indicator of a company’s profitability. It is calculated for the most recent 12 months - the (ttm) that usually comes after it means “trailing twelve months” - by dividing the company’s income by the average number of outstanding shares. Every time a company declares their earnings a fresh EPS is calculated and displayed along with the rolling 12-month figure.
Dividend: even if a company has earnings it does not mean they will hand them out as dividends immediately - dividends are paid at varying intervals at the decision of the company’s board of directors. All dividends paid out in the last 12 months are added to create a Dividend (ttm), which in our example means that Cryptologic paid out 0.48$ per share in the last 12 months. This is then divided by the last closing price to get the Yield percentage for those who prefer to see their earnings in percentage form.
You are now ready to tackle the stock info and make some sense of it. Coming up next: what to expect from your stock, and how measure risk versus profits.
This article was published courtesy of ThisIsTheNuts.com.
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