Stock Market Vocabulary
On this page, you'll find a glossary of stock market terms and definitions that you'll need to navigate the stock market, including everything from dividends to P/E ratios. Click on a stock market term below to look up its definition.
The WealthLift sentiment is a quick and easy way to gage the overall sentiment of the WealthLift Investor Community on a particular stock. It gives the proportion of current overperform and underperform picks placed on a stock by WealthLift members. A WealthLift sentiment above 50 implies that a larger proportion of WealthLift users see the stock overperforming the market in the future, while a sentiment below 50 implies that a larger proportion of WealthLift users believe the stock will underperform the market in the future.
The Previous Close gives the stock price for a company at the end of the previous trading day. For example, if Apple Inc has a stock price of $300 on the close of trading on Monday, its Previous Close would be listed at $300 on Tuesday. The Previous Close number is a quick way to compare today's price with yesterday's closing stock price to see how the stock has moved today.
The Day Range gives the lowest and highest price that a stock has traded for on any particular day. It provides information about the extent of price volatility for a stock on a particular day by showing how far up and down the stock has moved during that day.
52 Week Range
The 52 Week Range gives the lowest and highest price that a stock has traded for in the last year (ie. the last 52 weeks). It provides information about the extent of price volatility for a stock in the last year by showing how far up and down the stock has moved during that time.
Volume represents the number of shares that have been traded for a particular company on any particular day. It can be compared to the Average Daily Volume to see if the stock is especially active or inactive on any trading day, usually because of recent company news or announcements. Please note that after market open hours (before 9.30 am or after 4pm EST on weekdays, and on weekends) this number only represents after-hours trading, which is typically much lower than market trading.
Average Daily Volume
The Average Daily Volume gives the average Volume of shares traded for a company on an average day in the past year. This number should be the point of comparison when trying to see if a company is being more or less heavily traded by the markets on any particular day.
The Shares Outstanding number represents the total number of shares that have been issued by the company and that are currently owned by shareholders. Since each share is worth exactly equal to the stock price and the shares outstanding number gives the number of shares in existence, multiplying the current stock price by shares outstanding gives the total market value of the whole company, the Market Cap.
This number represents the total value of a company as determined by the stock market. It can also be calculated by multiplying the most recent stock price by the number of Shares Outstanding.
This number is given by dividing the stock price of a company by its last year's worth of earnings. For earnings, the Earnings Per Share (EPS) number is used. This number is an indicator of how expensive the stock price of a company is relative to the earnings it generates. It can be an important number in figuring if a company's stock is undervalued or overvalued. Learn more in WealthLift Lesson 3 - What makes a company valuable and what makes a stock a "Buy"?
Earnings Per Share (EPS)
This number is given by dividing the total earnings, or profits, of a company in the last year by the number of Shares Outstanding for a company. It provides a quick indication of the profits that each share is entitled to, and can be used together with the stock price to derive the Price-to-Earnings Ratio, an indicator of the relative "cheapness" for a stock. Since a large company most often has millions of shares outstanding, the total profits of a company mean very little for a stock investor, while the EPS number is much more important. Stock investors look for a rising EPS in companies as a sign of growth. Learn more in WealthLift Lesson 3 - What makes a company valuable and what makes a stock a "Buy"?
Dividends are payments made by a company to its shareholders as a way of distributing a company's profits to shareholders. A company's management decides how much of the year's profits to distribute to shareholders, and how much to retain to reinvest in the company's operations. The dividend number listed is the amount to paid as dividends per share to shareholders in the last year. This dividend number is multiplied by the number of stocks a shareholder owns to get the amount of the total dividend payment. Learn more in WealthLift Lesson 2 - Strategies for Stock Investing.