Stock Symbol (Ticker Symbol): Abbreviation for a Company's Stock (2024)

What Is a Stock Ticker Symbol?

A stock symbol or ticker is a unique series of letters assigned to a security for trading purposes. Stocks listed on the New York Stock Exchange (NYSE) can have four or fewer letters. Nasdaq-listed securities can have up to five characters.

Ticker symbols are a shorthand way of describing a company's stock so there's no significant difference between those that have three letters and those that have four or five.

Key Takeaways

  • A stock symbol is an arrangement of characters, usually letters, that represent publicly traded securities on an exchange.
  • A company selects an available symbol for its shares when it issues securities to the public marketplace.
  • The symbol is often related to the company name.
  • Investors and traders use the symbol to place trade orders.
  • Additional letters denote additional characteristics such as share class or trading restrictions when they're added to stock symbols.

Why Did Investors Start Using Ticker Symbols?

Ticker symbols were created to streamline the process of hundreds of trades being made by the minute.

Floor traders had to communicate the stock price of a traded company by writing or shouting out the name of the company when modern stock exchanges came into being in the 1800s. This process was time-consuming and held up the information queue as the number of publicly traded companies increased from dozens to hundreds. They were unable to keep up with frequently changing prices, especially after the stock-quoting ticker tape machine was introduced in 1867.

To be more efficient in relaying price changes on company stock to investors, company names were shortened to one to five alpha symbols. Today, stock tickers still exist but digital displays have replaced paper ticker tape.

In addition to saving time and capturing a specific stock price at the right time, stock symbols are useful when two or more companies have similar monikers. Citigroup (C) and Citizens Financial Group (CFG) have similar names but they're not affiliated with each other. Citigroup is a global bank and Citizens Financial Group is a bank holding company for Citizens Bank. Both firms trade on the NYSE with Citigroup trading under the ticker C and Citizens Financial Group under CFG.

Some companies are spin-offs of the same company and have similar stock symbols. Hewlett-Packard split into two separate companies in November 2015: Hewlett Packard Enterprise (HPE) and HP Inc. (HPQ).

Hewlett Packard Enterprise serves as the business service and hardware division and focuses on servers, storage, networking, and security. HP Inc. is the consumer-facing computer and printer division and has a smaller market for its products than HPE.

Some companies that trade on the Nasdaq with four or fewer letters include Meta (META), formerly Facebook, and MoneyGram International (MGI). Companies moving from the NYSE to Nasdaq can retain their stock symbols.

Types of Ticker Symbols

Preferred Shares

A company will have the class added to its suffix if it has more than one class of shares trading in the market. The letters "PR" and the letter denoting the class will typically be added If it's a preferred stock. A fictional preferred stock called Cory's Tequila Corporate Preferred A-shares would have a symbol such as CTC.PR.A. Sources can quote preferred shares in slightly different ways.

Share Voting Class

Some stock symbols indicate whether the shares of a company have voting rights, especially if the company has more than one class of shares trading in the market.

Alphabet Inc., formerly Google, has two classes of shares trading on the Nasdaq with stock symbols GOOG and GOOGL. Common shareholders of GOOG have no voting rights because GOOG shares are Class C shares. GOOGL shares are Class A shares and have one vote each.

Berkshire Hathaway has two classes of shares trading on the NYSE: Class A and Class B. Class A shares are listed with the stock symbol BRK.A and Class B shares trade with the symbol BRK.B. Class B shares have lower voting rights than Class A.

Other types of ticker symbols include those designated for mutual funds or options listed on stocks.

Stock Ticker Modifiers

Stock symbols are also used to convey information to investors about the trading status of a company or its shares. This information is usually represented on the NYSE by one letter following a dot after the stock’s standard company symbol.

A fifth letter is added to stocks that are delinquent in certain exchange requirements on the Nasdaq. The first four letters represented the stock symbol for Acer Therapeutics Inc.: ACER. Adding a last letter ‘W’ indicated that the shares had warrants attached. The result was ACERW.

A company that's in bankruptcy proceedings will have the letter Q after its symbol. A non-U.S. company trading in the U.S. financial markets will have the letter Y following its ticker symbol.

The meaning of the letters from A to Z are:

  • A: Class A shares (e.g., BRK.A)
  • B: Class B shares (e.g., BRK.B)
  • C: Issuer Qualification Exception when the company does not meet all the exchange’s listing requirements but can remain listed on the exchange for a short period.
  • D: New issue of existing stock
  • E: Delinquent or missed one or more SEC-required filings (may also be denoted by .LF)
  • F: Foreign issue
  • G: First convertible bond
  • H: Second convertible bond
  • I: Third convertible bond
  • J: Voting share
  • K: Non-voting share
  • L: Miscellaneous (foreign preferred, third-class of warrants, preferred when-issued, and fifth-class preferred shares)
  • M: Fourth-class preferred shares
  • N: Third-class preferred shares
  • O: Second-class preferred shares
  • P: First-class preferred shares
  • Q: In bankruptcy proceedings
  • R: Rights
  • S: Shares of beneficial interest
  • T: With warrants or with rights
  • U: Units
  • V: When-issued and when-distributed. These shares are about to go through a corporate action plan that has already been announced, such as a stock split.
  • W: Warrants
  • X: Mutual funds
  • Y: American Depositary Receipt (ADR)
  • Z: Miscellaneous situations (same as the letter L)
  • OB: Over-the-counter bulletin board
  • PK: Pink sheets stock
  • SC: Nasdaq Small-Cap
  • NM: Nasdaq National Market

Some trading platforms, news, and market data services also use ticker modifiers that are unique to their service. An example would be a broker who uses an XD footnote or suffix to indicate that a stock is trading ex-dividend.

Companies trading on the NYSE typically have three or fewer letters but they can have four representing their stock symbols. Nasdaq firms generally have four- or five-letter symbols such as Adobe Inc. (ADBE), Apple Inc. (AAPL), and Groupon Inc. (GRPN)).

History of Ticker Symbols

The ticker symbol was invented by Edward Calahan, a telegraph operator who worked for the New York Stock Exchange (NYSE). Calahan developed the ticker symbol in 1867 as a way to quickly and accurately transmit stock prices over telegraph lines.

Calahan's ticker symbol consisted of two letters representing the company's name followed by a number representing the number of shares being traded. The ticker symbol was transmitted via telegraph and displayed on ticker tape machines that were used to keep track of stock prices in near real-time.

Calahan's invention revolutionized the way stock prices were reported and it helped to make the stock market more efficient and transparent. Ticker symbols are used by most major stock exchanges around the world these days and are an important part of the financial industry.

The first ticker symbol was used by the New York Stock Exchange on November 15, 1867 to identify the shares of the Union Pacific Railroad Company. The ticker symbol consisted of two letters (UP) followed by a number representing the number of shares being traded.

The NYSE expanded the use of ticker symbols to include three letters in the 1920s and four letters in the 1950s as the number of publicly traded companies and securities increased.

Ticker symbols are used by most major stock exchanges around the world and consist of up to five letters. They've become an important part of financial branding and marketing in addition to identifying specific securities. Many companies choose ticker symbols that are easy to remember or have some connection to their business or brand.

How to Use a Ticker Symbol

Ticker symbols are used to identify specific publicly traded companies and the securities they issue. They're typically made up of one to five letters and are used to identify a specific stock or bond on a stock exchange or financial platform.

You can use a ticker symbol in several ways:

  1. Identify a specific security: Ticker symbols are used to identify a specific security such as a stock or bond on a financial platform or stock exchange. The ticker symbol for Apple Inc. is "AAPL." The ticker symbol for the S&P 500 index is "SPX."
  2. Track stock prices: Ticker symbols are often used to track stock prices in real time on financial news websites and stock ticker boards.
  3. Place a trade: Ticker symbols are used in stock trading orders to identify the specific security being purchased or sold.
  4. Research a company: Ticker symbols can be used to find information about a specific company such as its financial statements and news articles.

You must typically enter the ticker symbol into a financial platform or stock exchange's search function or use it in a trading order. Ticker symbols are typically displayed beside a company's name and stock price on financial news websites, stock ticker boards, and other financial platforms.

How Do I Find a Company's Stock Ticker Symbol?

You can search online financial databases, check the company's website, check the stock exchange's website, or ask a financial advisor or broker.

It's possible that the company isn't publicly traded or is listed on an exchange outside of the United States if you're having trouble finding a company's ticker symbol. It may be more difficult to locate it in these cases.

Why Is It Called a Ticker Symbol?

Stock symbols are called tickers because they first appeared as imprints on ticker tape that were transmitted by telegraph from stock exchanges to investors around the country. The name persisted even after physical ticker tape was replaced by more modern technologies.

What Are Some Examples of Stock Tickers?

Some examples of popular ticker symbols include:

  • Apple Inc. (AAPL)
  • Alphabet Inc. (GOOGL)
  • Microsoft Corporation (MSFT)
  • Amazon.com, Inc. (AMZN)
  • Meta (formerly Facebook) Inc. (META)
  • Tesla Motors (TSLA)
  • The Goldman Sachs Group, Inc. (GS)
  • The Dow Jones Industrial Average (DJIA)
  • The S&P 500 Index (SPX)
  • The NASDAQ Composite Index (COMP)

The Bottom Line

Stock ticker symbols are unique, alphabetic codes that are used to identify publicly-traded companies and the securities they issue. They're typically made up of one to five letters and are used to identify a specific stock or bond on a stock exchange or financial platform.

Ticker symbols are typically displayed beside a company's name and stock price on financial news websites, stock ticker boards, and other financial platforms. They're also used in stock trading orders to identify the specific security being purchased or sold.

Stock Symbol (Ticker Symbol): Abbreviation for a Company's Stock (2024)

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