A stock ticker symbol is a unique letter series designating a company listed on the stock exchange. Securities listed on Nasdaq can have up to five letters, while those on NYSE can have a maximum of four. There isn’t much of a difference between the number of letters because stock ticker symbols are only a shorthand way of designating securities. “Stock ticker symbol” and “stock symbol” are the same thing.
History of stock tickers
The earliest stock exchanges date from the 19th century. At that time, floor traders had to shout or write out the full name of the organization to inform others of the price of its stocks. When few companies were listed, this wasn’t an issue. As they became more numerous, they had to find another way. That’s how stock tickers came to be.
Companies that are trading more than one share class have the class added at the end of the ticker symbol. The letters PR are added for preferred stock.
Other features of stock symbols
Companies moving to Nasdaq from NYSE can keep their ticker symbols. Most companies that trade on the Nasdaq have four letter symbols, but there are some with fewer, such as MGI for Moneygram International and FB for Facebook.
The term “stock ticker” comes from “tick”. On financial markets, this means any security price movement, up or down. A stock ticker is a report on the price of the stock, which different exchanges update during the trading session continuously.
Stock tickers display security price changes automatically along with trading volume and other information traders and investors need to have to be aware of market conditions and demand for that particular stock.
Let’s wrap up
Stock symbols represent securities listed and traded publicly on an exchange. They are usually an arrangement of letters and are used by traders and investors to place trade orders. Companies that list securities on exchanges choose an available symbol for them, usually associated with the name of the company. You can add other letters to stock symbols if there are any trading restrictions, a share class, or other characteristics. The difference between ticker symbol and stock ticker is that the latter relates to changes in the security’s price.
