Stock Indexes
An understanding of the basic characteristics of the different kinds of stocks will be helpful in considering the information in this entry. (See "Stocks")
An investor's most important tool is information: information about stock prices, movement in the market, and business trends. Without sound information, investment decisions are pure guesswork. The first place to look for information about any stock is the financial pages or a newspaper, and the best place to start is with the columns listing the current stock prices on one or more of the major organized exchanges. Figure 1 shows a typical listing for a stock traded on one of the major exchanges, and the following list explains the information in the figure and what it means for prospective investors:
- High and low. These are the highest and lowest prices paid for the stock during the previous fifty-two weeks. This entry shows that the highest price paid for this stock during the previous period was $44 per share; the lowest price, $16 per share.
- Stock. Stocks are listed alphabetically by an abbreviated form of the corporate name.
- Dividend. The rate of annual dividend is shown; it is generally an estimate based on the previous quarterly or semiannual payment.
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