Identifying Ticker Symbols and Interpreting Stock Quotes Lesson Summary Identifying Ticker Symbols and Interpreting Stock Quotes helps students to understand and locate ticker symbols in order to trade stock. Lesson Objectives Determine how to look up a ticker symbol. Analyze a stock table to understand important elements such as dividends and P/E ratios. Gather data from both print and internet sources. Enter a trade in The Stock Market Game portfolio. Demonstrate the ability to use each of the following terms: share or stock, dividend, P/E ratio, volume or sales, net change. NCTM Standards 1A - Understand numbers, ways of representing numbers, relationships among numbers, and number systems. 5A - Formulate questions that can be addressed with data and collect, organize, and display relevant data to answer them. 5B - Select and use appropriate statistical methods to analyze data. 5C - Develop and evaluate inferences and predictions that are based on data. 5D - Understand and apply basic concepts of probability. 6A - Build new mathematical knowledge through problem solving. 6C - Apply and adapt a variety of appropriate strategies to solve problems. 8A - Organize and consolidate mathematical thinking through communication. 8B - Communicate mathematical thinking coherently and clearly to peers, teachers, and others. 9C - Recognize and apply mathematics in contexts outside of mathematics. 10A - Create and use representations to organize, record, and communicate mathematical ideas. Mathematical Strands Thinking Algebraically Interpreting Statistics Communicating Quantitative Information Tackling Complex Problems Students sharpen their estimation skills by estimating the product of large numbers and then checking their answers. Students also round to the nearest cent. Students interpret graphs and make decisions based on the information presented. Students graph, choose scales, and make informed decisions based on trends and their knowledge of the market. Students calculate and track the value of a sample SMG portfolio, including commissions. 14
THINKING ALGEBRAICALLY You need to be good at estimating when you are working with stocks because you are working with so many decimals. Let s practice estimating with the buy orders in the tables below. First, write your estimated price per share and then your estimated number of shares. Next, write your best estimate for the total cost. At the end, go back and figure out how close your estimate is to the actual value. (An example is done for you.) Price p er Share # of Shares Estimated What s the A ctual Total Total Difference? Estimate Estimate $48.75 $50 195 200 $1 0,000 $9 506.25 $493.75 $21.32 594 $9.76 10,041 $14.68 98 $33.02 4,051 $103.78 1,978 $88.97 71 $48.69 52 $22.08 395 $39.42 810 $28.73 152 $59.46 214 15
THINKING ALGEBRAICALLY Closing prices of stocks are often reported with four decimal places. Though a tenth or a hundredth of a cent might not seem like much, if you own millions of stocks, those fractions of a penny really matter! Practice rounding the decimals below to the nearest hundredth. $ 32.5219 $ 87.5292 $ 0.24381 $ 35.9961 $ 36.5332 $ 78.6669 $ 14.1222 $ 48.3452 $ 295.6349 $ 65.8486 $ 43.4521 $ 863.7987 $ 27.1658 $ 338.8948 $ 21.0015 $ 99.9949 $ 46.0096 $ 56.86089 $ 32.5672 $68.0063 16
INTERPRETING STATISTICS This is a six-month graph of closing prices of Texas Instruments Corporation stock. Texas Instruments, Inc. (TXN) $34.00 $33.00 $32.00 Closing Price $31.00 $30.00 $29.00 $28.00 $27.00 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 If an investor bought the stock in the beginning of August, about how much did he/she pay? 2. If the investor sold the stock in the beginning of September, about how much did he/she sell it for? 3. How much profit/loss was incurred between the beginning of August and the beginning of September? 4. If the investor had held onto the stock until the beginning of October, how much would he/she have sold the stock for? 5. How much profit/loss was incurred between the beginning of August and the beginning of October? 17
COMMUNICATING QUANTITATIVE INFORMATION This is a list of closing prices for Motorola Inc. (MOT) from December 13, 2006 to January 13, 2007. Date Closing Price 12-Jan-07 $18.01 11-Jan-07 $18.20 10-Jan-07 $18.16 9-Jan-07 $18.26 8-Jan-07 $18.60 5-Jan-07 $18.94 4-Jan-07 $20.55 3-Jan-07 $20.57 29-Dec-06 $20.56 28-Dec-06 $20.55 27-Dec-06 $20.55 26-Dec-06 $20.48 22-Dec-06 $20.26 21-Dec-06 $20.32 20-Dec-06 $20.41 19-Dec-06 $20.49 18-Dec-06 $20.76 15-Dec-06 $20.71 14-Dec-06 $20.69 13-Dec-06 $20.65 1. Create a graph that displays the one-month trend of the stock s closing price. 2. Write a short description of the trend in closing prices. 3. What is the lowest price shown on the graph? Circle and label this point. 4. What is the highest price shown on the graph? Circle and label this point. 5. Between which two days did the price of the stock grow the most? 18
Calculate the value of the following portfolios: TACKLING COMPLEX PROBLEMS Team A Stocks Quantity Price per Share Value The Coca-Cola Company (KO) 200 $48.26 Google (GOOG) 52 $489.75 3M Company (MMM) 100 $79.25 Ocean Bio-Chem Inc. (OBCI) 6000 $4.40 InSite Vision Incorporated (ISV) 7000 $1.50 Total Value of Stocks Purchased Commission Charged for Purchase Cash on Hand Current Value of Portfolio Team B Stocks Quantity Price per Share Value Exxon Mobil Corporation (XOM) 400 $73.53 Apple Incorporated (AAPL) Biogen Idec Incorporated (BIIB) American Express Company (AXP) Tiffany & Co. (TIF) 650 $88.50 200 $51.84 115 $58.09 320 $40.04 Total Value of Stocks Purchased Commission Charged for Purchase Cash on Hand Current Value of Portfolio 19
Identifying Ticker Symbols and Interpreting Stock Quotes ANSWER KEY Please Note: 1. Prices included in lesson are not representative of actual market data and are for instructional purposes only. 2. Discrepancies may occur between student responses and the answer keys as a result of how far calculations were taken past the decimal point. In most instances, numbers were rounded from the thousandth or ten thousandth place. You need to be good at estimating when you are working with stocks because you are working with so many decimals. Let s practice estimating with the buy orders in the tables below. First, write your estimated price per share and then your estimated number of shares. Next, write your best estimate for the total cost. At the end, go back and figure out how close your estimate is to the actual value. (An example is done for you.) Answer: Estimated answers may vary. Actual totals will be exact. Price per Share # of Shares Estimated Total Actual Total What s the Difference? Estimate Estimate $48.75 $50 195 200 $10,000 $9506.25 $493.75 $21.32 $20 594 600 $12,000 $12,664.08 $664.08 $9.76 $10 10,041 10,000 $14.68 $15 98 100 $33.02 $30 4,051 4,000 $103.78 $100 1,978 2,000 $88.97 $90 71 70 $48.69 $50 52 50 $22.08 $20 395 400 $39.42 $40 810 800 $28.73 $30 152 150 $59.46 $60 214 200 $100,000 $98,000.16 $1,999.84 $1,500 $1,438.64 $61.36 $120,000 $133,764.02 $13,764.02 $200,000 $205,276.84 $5,276.84 $6,300 $6,316.87 $16.87 $2,500 $2,531.88 $31.88 $8,000 $8,721.60 $721.60 $32,000 $31,930.20 $69.80 $4,500 $4,366.96 $133.04 $12,000 $12,724.44 $724.44 Answer Key 13
Closing prices of stocks are often reported with four decimal places. Though a tenth or a hundredth of a cent might not seem like much, if you own millions of stocks, those fractions of a penny really matter! Practice rounding the decimals below to the nearest hundredth. Answer: $32.5219 $32.52 $87.5292 $87.53 $0.24381 $0.24 $35.9961 $36.00 $36.5332 $36.53 $78.6669 $78.67 $14.1222 $14.12 $48.3452 $48.35 $295.6349 $295.63 $65.8486 $65.85 $43.4521 $43.45 $863.7987 $863.80 $27.1658 $27.17 $338.8948 $338.90 $21.0015 $21.00 $99.9949 $100.00 $46.0096 $46.01 $56.86089 $56.86 $32.5672 $32.57 $68.0063 $68.01 Answer Key 14
INTERPRETING STATISTICS This is a six-month graph of closing prices of Texas Instruments Corporation stock. Texas Instruments, Inc. (TXN) $34.00 $33.00 $32.00 Closing Price $31.00 $30.00 $29.00 $28.00 $27.00 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 If an investor bought the stock in the beginning of August, about how much did he/she pay? Answer: about $33.00 2. If the investor sold the stock in the beginning of September, about how much did he/she sell it for? Answer: about $32.25 3. How much profit/loss was incurred between the beginning of August and the beginning of September? Answer: There was about a $0.75 loss per share (= $33.00 - $32.25). 4. If the investor had held onto the stock until the beginning of October, how much would he/she have sold the stock for? Answer: about $33.00. 5. How much profit/loss was incurred between the beginning of August and the beginning of October? Answer: The stock price for TXN was about the same at the beginning of August and at the end of October, so there would be no profit or loss on a share of TXN stock over this period. Answer Key 15
COMMUNICATING QUANTITATIVE INFORMATION This is a list of closing prices for Motorola Inc. (MOT) from December 13, 2006 to January 13, 2007. Date Closing Price 12-Jan-07 $18.01 11-Jan-07 $18.20 10-Jan-07 $18.16 9-Jan-07 $18.26 8-Jan-07 $18.60 5-Jan-07 $18.94 4-Jan-07 $20.55 3-Jan-07 $20.57 29-Dec-06 $20.56 28-Dec-06 $20.55 27-Dec-06 $20.55 26-Dec-06 $20.48 22-Dec-06 $20.26 21-Dec-06 $20.32 20-Dec-06 $20.41 19-Dec-06 $20.49 18-Dec-06 $20.76 15-Dec-06 $20.71 14-Dec-06 $20.69 13-Dec-06 $20.65 Answer Key 16
COMMUNICATING QUANTITATIVE INFORMATION 1. Create a graph that displays the one-month trend of the stock s closing price. Answer: $22.00 $21.00 Closing Price $20.00 $19.00 $18.00 $17.00 $16.00 12/13/2006 12/18/2006 12/23/2006 12/28/2006 1/2/2007 1/7/2007 1/12/2007 Dates 2. Write a short description of the trend in closing prices. Answer: The closing price of MOT stock was relatively stable from 12/13/2006 through 1/4/2007. In the last 8 days the stock price declined sharply. The closing price of MOT stock decreased during this time frame by $2.64. 3. What is the lowest price shown on the graph? Circle and label this point. Answer: $18.01 (01/12/07) 4. What is the highest price shown on the graph? Circle and label this point. Answer: $20.76 (12/18/06) 5. Between which two days did the price of the stock grow the most? Answer: Between 12/25/2006 and 12/26/2006, the stock price increased by $0.22. Answer Key 17
Calculate the value of the following portfolios: TACKLING COMPLEX PROBLEMS Team A Stocks Quantity Price per Share Value The Coca-Cola Company (KO) 200 $48.26 $9,652.00 Google (GOOG) 52 $489.75 $25,467.00 3M Company (MMM) 100 $79.25 $7,925.00 Ocean Bio-Chem Inc. (OBCI) 6000 $4.40 $26,400.00 InSite Vision Incorporated (ISV) 7000 $1.50 $10,500.00 Total Value of Stocks Purchased $79,944.00 Commission Charged for Purchase $1,598.88 Cash on Hand $18,457.12 Current Value of Portfolio $96,802.24 Team B Stocks Quantity Price per Share Value Exxon Mobil Corporation (XOM) 400 $73.53 $29,412.00 Apple Incorporated (AAPL) 650 $88.50 Biogen Idec Incorporated (BIIB) 200 $51.84 American Express Company (AXP) 115 $58.09 Tiffany & Co. (TIF) 320 $40.04 Total Value of Stocks Purchased Commission Charged for Purchase $57,525.00 $10,368.00 $6,680.35 $12,812.80 $116,798.15 $2,335.96 Cash on Hand Current Value of Portfolio $114,462.19 Answer Key 18