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Stock Closing Prices |
StockPricescom | Prices of Stocks | Sstocks | Sstock Prices
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Stocks - Closing Price
Many investors use closing prices
reported in the newspapers to monitor their holdings. But not all
closing prices are the same, and the differences may be important to
you.
Here's what you should know about stock closing prices:
"Closing price" generally refers to the last price at which a stock
trades during a regular trading session. For many market centers,
including the New York Stock Exchange, the American Stock Exchange,
and the Nasdaq Stock Market, regular trading sessions run from 9:30
a.m. to 4:00 p.m. Eastern Time.
But a number of market centers offer after-hours trading. Some
financial publications and market data vendors use the last trade in
these after-hours markets as the closing price for the day. |
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Others, however, publish the 4:00 p.m.
price as the closing price and display prices for after-hours trading
separately.
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Day traders
rapidly buy and sell stocks throughout the day in the hope that their
stocks will continue climbing or falling in value for the seconds to
minutes they own the stock, allowing them to lock in quick profits.
Day trading is extremely risky and can result in substantial financial
losses in a very short period of time.
This discrepancy in the way the media and others report closing prices
can cause confusion – especially when a single, low-volume after-hours
trade occurs at a price that's substantially different from the 4:00
p.m. closing price. For example, an investor might read on a company's
website that its stock closed at one price but then see a much
different price on the consolidated tape flashing across the bottom of
her or his television screen. Or, the next day, the investor might
hear that the stock opened "up" when, in fact, it opened "down"
compared with the price at the 4:00 p.m. close.
To help clear up this confusion, the central distributor of
transaction prices for exchange-traded securities – the Consolidated
Tape Association – implemented a system designed to make closing
prices uniform. Under this system, the regular session closing price
for stocks will be the 4:00 p.m. price. Sometimes orders come in
before 4:00 p.m., but they can't be filled until after 4:00 p.m.
Therefore, the CTA produces a 4:15 p.m. Market Summary for vendors and
the media that includes regular session trades that are reported
before 4:15 p.m. but should be included in regular session 4:00 p.m.
prices. Any trades that take place during after-hours trading sessions
will be "tagged" with the letter "T" on the consolidated tape and will
not affect the regular session closing price (or the regular session
high and low prices). The Nasdaq Stock Market, which operates a
similar system for trades in its securities, uses similar conventions.
Because the closing price for the same stock may continue to be
reported differently among various media and market data vendors,
investors should try to understand what the reported price is based
on. For example:
Does the newspaper or vendor indicate that the closing price is based
on the regular trading session price established on the security's
primary market, such as the New York Stock Exchange, the American
Stock Exchange, or the Nasdaq Stock Market?
Does the closing price reflect the last trade reported over the
consolidated tape as of the close of the regular trading session at
4:00 p.m. Eastern Time?
Does the closing price reflect the last trade reported over the
consolidated tape in after-hours trading?
Investors may be able to find this information if their newspaper or
vendor system describes how the closing price is being reported.
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Sources: Wikipedia, FCIC, SEC and other public sources.
Stock Closing Prices |
StockPricescom | Prices of Stocks | Sstocks | Sstock Prices
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