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become very wealthy and powerful. Although there are SEC limitations, some institutional investors are able to buy enough shares of a corporation to vote a member on to the board of directors and influence the way the company does business. There is power in numbers. One day you will be directly or indirectly invested in the stock market, as an individual investor building your personal wealth portfolio, or as a member of a retirement, pension or mutual fund (or both). To be financially literate in the 21st century, it is important to understand how stocks are analyzed for value and how they act as tools for building wealth . For technical data check the stock table. If you were thinking about buying a particular house, the first thing you’d do is find out the asking price. Then, to determine whether the asking price accurately reflects its value, you’d compare the house to similar houses in the neighborhood. That would give you a pretty good idea whether the house is overpriced, underpriced, or fairly priced. There are different layouts for stock tables, depending on the service that collects and reports the data. Sometimes information is presented horizontally, as with the HnnH stock table shown at the start of this lesson. Sometimes information is set out in a vertical column, or with slightly different abbreviations, or more or less information. Don’t let the presentation throw you, it’s the same basic technical data. Many online stock quotes are also interactive including links that open to additional data, graphs, charts, research, and reports. Stock charts can be found on any major financial site like Yahoo! Finance, CBS Marketwatch, MSN Moneycentral, Bloomberg.com, and CNN Money. (Remind students that they should read, watch or listen to the financial news at least 15 minutes every day) Direct students’ attention to the horizontal HnnH stock quote contained in Chapter 15 of their workbook. Students follow along with the letter guide to interpret the meaning of the number or symbol. Ask students to consider why the information would be of use or interest to an investor. 52 wk low 52 wk high $11.22 $18.76 Market cap $129.46M P/E 9 PRODUCT PREVIEW HealnnHeels HnnH Open $14.98 Chg -.15% Vol 15,700,000 Oct 13 10:38 a.m. ______________ Previous close $15.28 Day low Day high $14.90 $15.31 Stock buyers do sort of the same thing. The price of a single share of stock is easy to determine. Just check the quote to see what it sold for on the last trade. But price does not always reflect value. Value is relative; it can only be determined by comparison to another similar object. That is where the stock table comes in – it provides technical data about a stock, much of which is presented as percentages and ratios . Converting financial data to ratios and percentages enables comparison of the stock’s performance against the performance of other stock . That helps an investor determine if a stock is accurately valued, undervalued, or overvalued.
Lesson 15 | Walk’n on Wall Street 286
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