What It Is:
How It Works/Example:
When a company goes public orsecurities to the public, it selects an exchange on which those securities trade and a ticker symbol that identify those securities. In some cases, companies try to make their ticker symbols "memorable" (such as TAP for beer company Molson Coors or DNA for biotechnology Genentech).
The New York Stock Exchange (NYSE) uses ticker symbols with three letters or fewer (such as NYT for the New York Times Co. or T for AT&T). Ticker symbols with four or more letters generally denote securities traded on the American Exchange and Nasdaq. Symbols ending in X denote .
There are also special symbols that appear either as an additional letter in the symbol or, for , after a dot to denote certain types of securities. Tickers ending in Q, for example, denote issuers that are in bankruptcy; Y denotes that the security is an ADR.
Why It Matters:
Ticker symbols are key to facilitating the huge number of trades that occur every day around the world. Without them,and investors would likely confuse issuers, securities and different securities from the same . Ticker symbols, via their additional-letter codes, also communicate important information to investors about the trading status of the security or the .