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Understand market information

Stock markets

It used to be that newspapers were the place to find information about stock markets and mutual funds. Now many media outlets, including newspapers, stock exchanges, and ATSs publish this information online, which might include:

  • The name and trading symbol, with an indication if it’s a common or preferred share 
  • Pricing information for the day’s trading: the high, low, last trade price before the market closed, and the change in the closing price from the previous day 
  • Volume – the number of shares traded in the day 
  • The high and low share price over the prior 12 months

If you are thinking about purchasing shares, you may want to know whether the current day’s trading price is close to the 12-month high or low before you make your purchase decision.

Stock exchanges publish corporate and trading information, which you can search by name or stock symbol. Some additional information you might find on these websites includes:

The earnings per share (EPS) will tell you if the company is making or losing money, and how much per share. The price/earnings ratio (P/E) tells you how many times earnings the stock is trading. A low P/E ratio means you are paying less for your shares relative to corporate earnings. The About the market page includes links to several stock markets.

Bond markets

Bond information is harder to come by, but online sources should include:

  • Name of the issuer and bond type. If it is a strip bondglossary icon, it will likely be called a coupon (CPN) or residual (RESID)
  • Stated interest rate on the bond (or coupon rateglossary icon). If it is a strip bond, the coupon rate will be zero 
  • Maturity date
  • Pricing information, including the current high, low, close and percent change
  • Yieldglossary icon-to-maturity at the current price
  • Wholesale price

The most important information is the maturity date and the current yield. You need to know how long before the bond matures. The yield allows you to compare one bond to another, even those with different maturities and different coupon rates. Remember your yield will be less than the posted yield, because you will need to factor in your investment dealer’s mark-up. To find on-line information on bonds, go to the Government bonds page for links to several bond pricing sites.

Commodity and derivative markets

There’s no shortage of online material about commodity and derivative markets, but these products are highly complex and not suitable for most retail investors. If you want to invest in these types of products, talk to your advisor.

Indices

There are many different indicesglossary icon on most exchanges. For example, the S&P/TSX Composite Index tracks more than 150 of the TSX’s largest companies, while the S&P/TSX 60 Index track performance of 60 of its largest companies. The S&P 500 is an index tracking the 500 leading companies in leading industries of the US economy.

Various sub-indices follow particular segments of the market or particular industry groups. These are useful for understanding how a particular industry is doing.

Indices are useful resources for individual investors. You can use them to compare the performance of your portfolio against the performance of an index matching your investment categories. Are you on track?

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