This preview shows page 1. Sign up to view the full content.
Unformatted text preview: her words, 641,200 shares of this
stock were traded (bought and sold) on
this particular day. 1. Define:
a. investment bank
b. dividend Review Facts and
2. What information did
Charles Dow convey with
the Dow Jones Industrial
3. What does it mean to
“buy the market”? 26.5
14.5 • • • • (9) (10) (11) High Low Close (12)
6412 P/E 3.2 Closing price per share/Net earnings
per share Defining Terms (8)
00s 57.5 A stock with a PE ratio of 14.5, like the
one here, means that the stock is selling for
a share price that is 14.5 times its earnings
per share. What does this number tell us
about the stock? Let’s suppose that most
stocks have a PE ratio of 14.5. In comparison, let’s say stock X has a PE ratio of 50.
What would make stock X have a PE ratio
so much higher than most stocks? A high
PE ratio usually indicates that people
believe the stock will experience higher than
average growth in earnings. Whether they
are right remains to be seen.
• (7) 42.00
+0.24 The text on the
opposite page and
this page explains
how to read and
stocks found in the
newspaper. High. This number, 47.99, stands for
the high price the stock traded for on
this particular day, which translates to
$47.99 for this stock.
Low. This number is the low price the
stock traded for on this particular day.
The number is 47.00 and translates to
Close. The number
“Wall Street is the only place
that people ride to in a Rolls
$47.54—is the share
Royce to get advice from
price of the stock when
those who take the subway.”
trading stopped this
— Warren Buffet
Net chg. Net change is the difference
between the current closing price and
the previous day’s closing price. The
number here is +0.24, which translates
to $0.24, meaning that the price of the
stock on this particul...
View Full Document
This document was uploaded on 01/16/2014.
- Winter '14