How much thought you give to a stock ticker symbol? Stocks ticker symbols are one to five alphabetical codes we use to identify a particular stock being traded on an exchange. One glance on a stock symbol can give you a lot of information like the name of the company, it's financial health, where it gets traded and even the nationality of the company.
In the past each stock exchange in US had its own stock symbols. This would confuse investors and traders a lot. Standardized symbols were introduced by Standard & Poor as a way to clear that confusion when referring to stocks. Hey, this is the same Standard & Poor that maintains the S&P 500 Stock Index, considered to be the barometer of US economy.
Now, when we see MSFT on CNBC or for that matter Bloomberg TV, we immediately recognize Microsoft. Similarly when we come across GOOG, we immediately recognize the internet giant GOOGLE!
Now, as said before NYSE and AMEX haves three letter ticker symbols while NASDAQ has four to five letter ticker symbols. So just by looking at the length of the stock ticker symbol, any investor or trader would at once know where the stock was listed and being traded. SEC new ruling in 2007 changed the rules of the game again!
What this new SEC ruling did was it allowed the companies to change the exchange where it's stocks got traded while keeping the old ticker symbol. Now, you will find the stock exchange also listed with the stock symbol. For example you will often see ticker symbols like these NASDAQ:MSFT. This symbol tells you that the microsoft stocks get traded on NASDAQ.