Stock Market Ticker Key Terms

Use stock market ticker key terms to monitor equity investments more effectively

The stock market ticker is essentially a snapshot in time of an equity investment. The ticker tells you the current price, the percentage gain/loss, the bid and ask, and the trading volume. Depending on the sophistication of the stock market ticker, it may expand on these features, but most every ticker displays the aforementioned information at minimum. In order to use this information to make the proper investment decision, you need to know what each of these terms mean in the context of the stock market.

Trading volume

The trading volume is the number of shares of a particular stock that trade ownership on a given day. The higher the trading volume, the easier it is to sell or buy a stock at a given price point.

Market price

The price that the stock market ticker lists for a stock is the market price. In other words, the market price is how much a certain stock costs at any particular moment in the trading day. Most market prices for stock are extremely fluid throughout the trading day.

Percentage price change

The percentage price change is the difference between the closing stock price from the previous trading day and the current market price. For instance, if a stock sold for $2.00 at the previous close and is now trading at $3.00, that represents a 50% price change during the trading day.

Ticker symbol

The ticker symbol is the unique identifier given to each stock on an exchange. The ticker symbol is usually one to four letters and often correlates with the name of the company. For instance, the ticker symbol for Bank of America is BOA.

Bid and ask

The bid is the market price traders are willing to pay for a stock and the ask is the price traders are willing sell the stock for during the trading day. In general, the closer the bid and ask prices are, the greater the demand for the stock.

Average daily share volume

The average daily share volume represents the number shares of the stock traded on an average day. The average is taken from a one-year period of trading activity. If the trading volume on a particular day markedly exceeds the average daily share volume, it could be a sign that there's new information about the stock.