Whether you are new to investing or a seasoned pro, it’s important to know how to read ticker tape.

Ticker tape has all of the information you need to know about a stock at that moment in time.

While the historical use of ticker tape isn’t used, we still see ticker tape everywhere, from the news to Yahoo Finance. 

 

 

History of Ticker Tape

The first ticker tape was shared across the nation on a telegraph in 1867 by Edward Calahan, but Thomas Edison improved on this original ticker tape in 1871. Originally the stock information was converted into Morse code. 

The more modern ticker tape machines were invented in 1930 and were faster than the previous machines, but still took about 15 to 20 minutes.

The information was not always up to date and was physically printed out. Brokers had to make sure they were always close to a physical machine. 

The electronic ticker tape came out in 1966, and this provided minute-by-minute information on stocks which allowed brokers to get the most up-to-date stock information. 

 

Modern Ticker Tape 

Modern ticker tape is updated every second and is no longer printed.

However, the information on old historical ticker tape is still found in modern ways to analyze a stock.

With the internet, we can get much more up-to-date information on stock and no longer have to rely on 15 to 20-minute-old information. Instead, we know how quickly a stock can change in a couple of minutes. 

 

 

How to Read Ticker Tape 

Reading ticker information on a stock is straightforward once you know what each section means.

You can quickly see the:

Along with that information, you can quickly see if a stock is up or down by color. Green means up, and red means down.

 

Stock Symbol 

The stock symbol is one of the first things you will see on a ticker.

Every stock has its long name, and its shorter symbol.

This is how you can identify which stock is being mentioned on that ticker. If you don’t know what a stock symbol is, you can Google that symbol and vice versa; if you want to know a stock symbol, you can Google that company name. 

 

Shares Traded 

The shares traded is a number with an abbreviation to let you know the volume of stocks being traded at that exact moment.

Stocks are always trading, and this can help you know if there are a lot of trades happening or not.

The number will be followed by either the letter K (thousand), M (million), or B (billion). So if you see 5M, then you know 5 million shares are being traded at that moment. 

 

Price Traded 

The price of one stock is one of the most important pieces of information for an investor.

It lets you know how much it costs to buy one stock. All tickers will have this information, usually in the middle. This will be the last bid price for the stock and can change throughout the day. 

 

Change Direction 

The stock market opens every day at 9:30 am and closes at 4 pm Eastern Time.

At the end of the day, a stock will either be up or down. The following day, the ticker will be updated with the change direction of the stock.

This is a quick indication to see how that stock performed the previous day. 

 

Change Amount

The change amount on a ticker will tell you how much that individual stock has changed in relation to the previous day.

It can be higher or lower than the previous day and will reflect in a positive or negative number. If there is a high number change, you can quickly see if there is a huge change in the stock price from the previous day. 

 

Color 

Most tickers also have colors associated with the entire ticker.

This can give you a quick glance if the stock is up or down. This can be updated in real-time.

Again, this is a quick way to see how a stock is performing on that day. 

 

 

Final Thoughts 

While the term 'Ticker Tape' may not be used anymore, the information on the classic physical ticker tape is still being used to read stocks at a glance.

Therefore, it’s important to know how to read this information on the TV or the internet to evaluate how a stock is doing.

Photo by Andrea Piacquadio