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Lesson 14. How to Check Your Investments > Reading the Stock Tables - Pg. 82

How to Check Your Investments 82 For example, in high school, each teacher gave you a grade in each subject--an A in math, a B in English, and an A in science, for ex-ample. At the end of the year, all those grades were added up to obtain your grade point average, and that number was a much better indicator of the kind of overall student you were than the single grade you received for your performance in just one particular subject. Stock maintenance is no different. Assemble those different "grades" that each measure- ment vehicle assigns to your stock's ability to pay dividends, produce capital gains, and remain liquid, for example. Then, with all that information before you, evaluate your stock. Reading the Stock Tables The closest thing to a computer printing of numbers that are randomly generated yet appear to be compiled by humans is the stock tables listed in the pages of the newspaper. With their masses of numbers, acronyms, and fine print, these tables can look overwhelming to the uninitiated reader. Here's the secret, though: You don't need to know very much about the stock tables to use them. You just have to know enough to find the information you are looking for. Think of them as a phone book for the nearest large city. First, the phone book lists the name of every single person who lives in that city and who wants to be included in the book. By the same token, the stock tables list the name of every stock (well, not every stock, but you get the idea) in that market. For each name listed in the phone book, there is a phone number and an address. Then the same kind of information is given for businesses. The stock tables also list information relevant to the stock. When you compile all that information, you get a whole book, or in the case of financial information at least a couple of pages. You are not frightened by the phone book because you know that you don't need to know everything in it, just one or two lines, and you know how to find that information. The following explanations will enable you to do the exact same thing in the stock tables: how to dive right in and come up with information specific to your stock. The sample stock table contains the information considered standard in a stock table. This information is available from The Wall Street Journal, The New York Times, or your local newspaper in a virtually identical format. Stock Name Reading from the left in the table, go to the third column. These are the stock names, or the names of the companies whose stocks are listed. Remember, not every single stock is listed, but as a newer investor it is a pretty safe bet that your stock will be popular enough to be up there. Because of a lack of space, the tables take a lot of liberty with abbreviations and acronyms, and they ram words together, so you will have to be kind of creative when looking up your stock. Alaska Airlines, for example, is listed as AlaskaAir. That's not so hard, but American Airlines is listed under its parent company name of AMR. Like the phone book, the stock tables do assume that you know at least the name of the company whose stock you want to look up. Plain English The stock name is listed in the stock tables of the daily newspaper. The name usually appears as an abbreviation or an acronym. Motorola for example, is noted as MOT, Federal Express is noted as FDX, and Hertz Rent A Car is noted as HRZ. Tip The stock symbol assigned to American Airlines was AMR. When management created a parent company for the airline, the new holding company was christened with the stock symbol as a name.