265 145 9 10 11 high low close 12 net chg 3831 162

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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 Concepts 2. What information did Charles Dow convey with the Dow Jones Industrial Average? 3. What does it mean to “buy the market”? 26.5 14.5 • • • • (9) (10) (11) High Low Close (12) Net chg 3831 162 168 15 31028 6517 6412 P/E 3.2 Closing price per share/Net earnings per share Defining Terms (8) Vol 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 6.09 72.75 24.49 4.50 27.15 47.99 39.51 5.90 71.84 24.29 4.20 26.50 47.00 41.50 6.09 72.74 24.49 4.31 26.50 47.54 –1.90 +0.12 +0.03 -0.01 +0.21 +0.14 +0.24 The text on the opposite page and this page explains how to read and understand the information about 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 $47.00. Close. The number “Wall Street is the only place here—47.54, or 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 particular day. 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...
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This document was uploaded on 01/16/2014.

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