2

I'm trying to understand %change in price charts on Morningstar.

Here is a %change in price for 2 securities in the last 1D.

enter image description here

Why is it that neither of them started from zero? What's going on here? Does the negative start have to do with after-hours trading? Is it just a bug? Or is there some other explanation?

You can view the chart here. It's free.

  • 2
    I've wondered about that too. Maybe the 0% is yesterday's ending price, and the immediate morning bids on these securities were different from yesterday's ending prices. – RonJohn Jun 18 at 17:26
  • 1
    That's a good hypothesis. But it doesn't seem to be what they're doing. E.g. CMP closed at 56.28 yesterday. But the 1D graphs starts from 56.73, which is above 56.28, but the graph still starts from -0.68%, which is below 0%. – Zesty Jun 18 at 17:53
  • 1
    Do you have a link to the original chart or is it a premium service to see it? – Bob Baerker Jun 18 at 17:54
  • 1
    Curse you, Facts, for foiling me again!! – RonJohn Jun 18 at 17:57
  • 1
    Re CMP, I think it might be bad data from the provider. The first 4 trades during regular hours were at 9:31:00 EST at $56.84, $56.84, $56.73 and $56.73. The graph should start at $56.84 but since at four trades were nearly simultaneous, they grabbed $56.73. GIGO? – Bob Baerker Jun 18 at 18:06
2

It is because of before and after hours trading. The 0% represents where the stock closed the night before. Since the stock market technically isn't open overnight, the change is "instant" at the open of the market.

  • I suspected this. Do you have any data about the before-hours trading to verify this, so that I can accept this answer? – Zesty Jun 18 at 20:50
  • 1
    @Zesty What makes you think that trade will start at previous day price? Imagine this is a "previous hour" change tracking. – mootmoot Jun 19 at 7:32
  • 1
    Your answer has been confirmed by Morningstar. – Zesty Jun 19 at 7:47
  • 2
    This answer doesn't explain the graph that the OP put up. Posting actual prices that support the numbers in the graph would. – Bob Baerker Jun 19 at 14:37
2

In the image you show, it looks like both graphs end precisely at 0%, which is unlikely to be a coincidence. Both of them must be showing prices relative to the price now.

This has the practical advantage that if you change to the 5D view, the end of the chart will show the two graphs in the same relative prosition as the 1D view does.

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .