What is a ticker?

A ticker is a display that carries information on a stock: its name, what it’s worth, how many shares are available at the current price, and whether the price has risen or fallen during the day. 

It is important to understand how to read a stock ticker as it could help a trader decipher the useful information that the ticker contains. 

Key takeaways

What is a stock ticker? A tool for understanding stock market data 

The ticker contains a short name to identify the asset, also known as a ticker symbol or stock symbol. A ticker symbol is often an abbreviation of a company's name, and may include numbers or other characters. For example, the ticker symbol for Apple Inc. on the New York Stock Exchange (NYSE) is AAPL.

Tickers have been around in one form or another for a long time. Originally, they were printed on small pieces of paper called ticker tape. Incidentally, that is where the term ticker tape parade comes from, as shredded pieces of ticker tape were used to help celebrate an event. 

In stock market trading, tickers are used to quickly and easily identify a particular stock and monitor its performance. Traders and investors can track the price movements of a particular stock by searching its ticker symbol on a stock exchange's trading platform or financial news websites.

Types of ticker symbols

Different types of assets have different types of ticker symbols. For instance, if a company has more than one class of shares trading in the market, then it will have its classes added to its suffix. 

Preferred stock

A preferred stock of a company may use the same ticker symbol as its common stock, usually with a ".P" suffix added. For example, the preferred stock of Microsoft Corp. trades under the symbol MSFT.P.

Share voting class

Some ticker handles may indicate if shares grant their holders voting rights. For instance, Alphabet Inc, the company formerly known as Google, has GOOG stock, which does not grant shareholders voting rights, and GOOGL stock, which does. 

In some cases, shares will grant their holders different sorts of voting rights. Berkshire Hathaway, for instance, has Class A shares under the ticker symbol BRK.A, which grant their holders more voting rights than their Class B – BRK.B. 

Modifiers

Some ticker symbols have modifiers attached. For instance, on the NYSE, a letter followed by a full stop indicates that the share belongs to a certain class of stock. On the NASDAQ, a fifth letter often shows it belongs to a certain category of share. For example, a “Q” states the company behind the shares is subject to bankruptcy proceedings, while a “Y” states it is a foreign company trading in the American markets. 

How to read a stock ticker

A stock ticker contains some useful information for traders. Let’s look at a real-world example of a stock ticker:

In this example, we are looking at Apple’s stock ticker. According to the information provided, trader can learn the following facts about the stock: 

• Ticker symbol – AAPL

• Volume (shares traded) – 38.91 million

• Current share price – $160.77

• Price direction over the course of the trading day – upward

• Price change over the trading day – 1.98%

Being able to read tickers could help traders better understand the markets and how they work. Providing real-time data on the performance of stocks, tickers help traders make informed trading decisions. They also offer an easy way to compare different stocks quickly. 

By monitoring stock tickers, traders can try to take advantage of market movements, track the performance of their positions, and potentially identify buying and selling opportunities. when combined with fundamental and technical analysis.

Conclusion

Stock tickers provide a useful way for traders to keep track of the market performance. Combined with fundamental and technical analysis, they could help identify trends and make informed decisions about when to buy, hold, and sell. As such, with the right tools and knowledge, stock tickers could be a powerful asset for any trader.

FAQs