January 30, 2023
Prudhvi Raj

Ticker Tape: A Beginner’s Guide

Investors can obtain market information using ticker tape, which is a ribbon of paper or an electronic representation of price quotes that display linearly.

Ticker tape first debuted as a component of ticker devices in the 19th century, which printed stock symbols and numerical information to broadcast information about trades and prices through telegraph wire. Although the ticker tape is now electronic, the mechanical ticking sound the first analog machines produced and the long, narrow strips of paper that stock quotes were written on gave it its name.

History of Ticker Tape

Edward Calahan developed the first telegraphic ticker tape prototype in 1867, which is when the stock price ticker tape first appeared. Calahan's concept was enhanced and patent-protected by Thomas Edison in 1871. The first version of the system used specialized keyboards to translate stock-related data into morse code. The device on the other end then read it.

Revisions to ticker tape machines were released in 1930 and 1964. These machines processed information far more quickly than their forerunners. The time difference between the transaction time and the time it was recorded was still around 15-20 minutes. Brokers kept offices close to the exchange in the late 19th century to guarantee that the most recent transaction data was accessible as soon as possible.

A real-time electronic ticker was introduced in 1996. Messengers made a circuit between the trading floor and the brokerage companies to relay transaction details that were up to the minute updated. Currently, quotes scroll continuously throughout the trading day to display data that is either current or somewhat delayed.

How Do You Read Ticker Tape?

Ticker tape feeds display a stock symbol based on its exchange ticker. Next to the symbol, it will provide the price of the most recent trade, as well as the volume, whether the trade was an uptick or a downtick, and the percentage change in price from the open price.

Ticker Tape in Share Markets: An Understanding

A ticker tape typically shows the following things:

1. Each entry on the ticker includes a stock symbol that identifies the business whose stock was traded. A distinctive code is the stock symbol.

2. The quantity of shares being traded.

3. Share Price: The cost per share at which a transaction is carried out.

4. Triangles are frequently used as visual cues in computer graphics. It shows if the current trade price is higher or lower than the previous day's closing price.

5. Delta is the difference between the trading price and the previous day's closing price.

6. Green is used to signify that the trading price is higher than the previous day's closing price, while red shows that the trading price is lower than the previous day's closing price. When the trading price and the previous day's closing price are the same, blue is utilized.

7. Decimal prices are used to display trading prices.

The main function of a ticker tape is to show the difference between the closing price at the end of the previous trading day and the current market price of an asset.

Additionally, the ticker tape's components help investors determine the current state of the market sentiment. Technical analysis, future price projections, and stock behavior analysis all employ ticker tape data.

Due to the regular presentation of data regarding the most active securities, ticker tape is particularly helpful for people who are new to the stock market.

Reading the Ticker Tape

Let's take the following example into consideration to better understand how to read the ticker tape: PELT 10K @ 1890 ^ 100

1. PELT - The ticker symbol, PELT, designates the business whose stock is being traded.

2. 10K - 10K is the amount of deal that is being reported. K is often equal to 1000, M to 100,000, and B to a billion. Ten thousand shares are being traded in this instance.

3. @ Rs. 1890-The price per share for a given trade is @ 189

4. 100 - The price change from the close of the previous day is shown. The direction change shows whether the stock is trading higher or lower than the closing price from the prior day. In this instance, the sign denotes that the trading price is Rs. 100 more than the previous day's closing price.


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