Investing in the stock market takes thoughtful analysis on the price of a particular stock. The analysis may look into the stock’s past trend of price fluctuations as well as future projections of possible prices. However, one of the most important terminologies used when dealing on the stock market is end of day stock prices, often referred to as the EOD price.
End of day stock price is the final closing price of a stock when the stock market concludes its trading activity for the day. Stock prices, on a given day, can swing either like a pendulum or can remain fairly static based on factors such as stock’s trading volume, investor’s perception and overall market performance. However, it is the closing price that analysts are most interested in to project the future trend of a particular stock. A brief examination of different kinds of stock prices an investor may come across on a given day is illustrated below.
This is the price of the stock that is first used for trading as soon as the stock market opens on a given day. The price can be particularly important for day traders, who are looking for short-term gains. The other important aspect of the opening price is that it facilitates comparisons with the end of day stock price, quantifying all the intra-day gains and losses experienced by the stock. Typically the stock’s opening price would not be the same as its end of day stock price unless there was no trading in the day.
As the name illustrates, these are the two extremes that a particular stock experiences on a given day. Almost all trading screens across the globe illustrate both these prices in order to enable investors to see the complete picture of a particular stock. A share opening at $30 in the morning but touching $40 anytime during the day gives out a possible signal to investors about the expected profitability the stock may bring to the investors in the near future. Similarly, the price of the same stock, having recovered from, say $20, might worry investors a bit as they might be exposed to a slide in the stock price without much recoverability if they hold on to the stock.
Though all above types of stock prices are equally important and have their due role in decision making, the importance of end of day stock prices cannot be over emphasized. It is one price that forms the basis of comparison of a particular stock’s growth percentage to the overall market index growth rate. Any significant parity between the two can easily signal an unusual or a temporary trend in the stock price so the investor can tread carefully when deciding on the sale / purchase of the stock. Further, almost all investment software makes use of the end of day stock prices to analyse and depict the important trends of a particular stock to their investors.