Beginners Guide to the Stock Exchange Symbols in Nigeria

Nowadays, stock market symbols (based on their length) can’t even let you know which stock market a share is traded on. Sorry. It could be kinda cool if you should know, right? But why Am I even talking about it?

Because not too long ago, you could be asking what is a stock market or how does stock work in the share market. The truth is this only recently changed (a few years ago) in 1997. So, before 1997, you don’t know if your stock was on the NYSE. The “NYSE was the 1st stock exchange of these types introduced in Nigerian stock exchange, and because of this the initial companies were on this exchange. These tickers all contains 1 or 2 letters”.

After the NYSE came the AMEX. Companies were now awarded three letter stock exchange symbols. These stocks were added to the AMEX (American Stock Exchange) or perhaps the NYSE (New York Stock Exchange). So every company before 1997 using a three letter symbol was traded on either the AMEX or NYSE.

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But, let’s not forget about the NASDAQ (National Association Of Securities Dealers Automated Quotations). At that time, any stock symbol with more three letters was traded with this exchange. So what happened next after the introduction of NASDAQ?

Well, a law was passed where companies could change which exchange they traded on. However, we didn’t just wake up one day and everything was different. In fact, it was a slow Change for everyone in the stock market.

The initial restriction that has been lifted allowed stock exchange symbols with three letters that were on the NYSE, to move to the NASDAQ with the same symbol. Obviously, policy loosened and very soon more companies were free to move around from exchange to exchange to trade stocks.

Now, companies can move from the NASDAQ to the NYSE and it doesn’t matter how long their symbol is. As you know, the NYSE is “regarded as the most prestigious of all of the exchanges”. So, obviously they don’t mind if a few companies leave. So, easily, with this moving around, the NASDAQ now hosts companies with symbols ranging from 1 to 5 letters.

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The Explanation For Longer Tickers

Many stock market symbols have 1-4 letters. However, you could find a few with five letters. Why exactly is that? The 5th letter represents something about the company. It gives you a couple of insider information.

“Even though with many different stocks nowadays it is not possible tell which market they trade on, with five letter stocks, you’ll be able to. When there are a period of time ahead of the last letter (or perhaps the last two letters), it is on the NYSE and if there is no period, it’s on the NASDAQ”.

You can even see four letter stock symbols which have a dot close to the end. The preceding letter still means exactly the same thing. So, exactly what does the extra symbol specify?

Since you may have guessed, “there are many things it may stand for. For example, “X” stands for “Mutual Fund”, “F” stands for “Foreign”, and “E” is short for “Delinquent With The Sec”.

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Are you into the stock market today? Let us know if there is any stock exchange symbols we omitted in this article. Leave your comment below.

 

 

 

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