2

So, in the real-time charts I have access to, the stock price is updated every 1 minute.

Let's say, stock XXX's price at 3:24 PM is $65.66, and then at 3:25 PM it jumps up to $65.78. Does this mean:

  1. The last trade made before 3:25 PM was priced at $65.78 and that's what the chart shows?

  2. The average price of all trades made between 3:24 PM and 3:25 PM is $65.78 and that's what the chart shows?

Since, thousands of trades go through every minute, I am wondering what the charts show. While I understand that the "last traded price" is supposed to be the best indicator of the current price of something, I am wondering if the real-time charts online actually follow that or do they average the whole minute?

3

The chart will be updated with the last traded price at or before that time.

However, with some real time dynamic charting programs (dynamic means the price is updated with every new change in trade) you can actually change between last traded price, the latest bid price or the latest ask price. These type of charts are usually only provided by a broker's trading platform.

In most charting programs you will only see the last traded information, whether you have the chart type as a line, OHLC, bar or candlestick.

If you are looking at a daily chart, the open, high, low and close would get updated every minute on a bar, OHLC or candlestick chart. In a line chart just the last traded price would be updated, because that is all that you are looking at with the line.

If you are looking at intra-day charts like at minute intervals, then a new bar or candle will appear every minute with the open, high, low and close for that minute. If you are looking at a line chart then a new last traded dot will appear for the last traded price for that minute.

Most charting programs do not use averages, they use actual traded prices.

  • A candlestick chart shows first, last, high, and low for each interval. You answer explicitly claims (wrongly) that it will only show the last price. "In most charting programs you will only see the last traded information, whether you have the chart type as a line, OHLC, bar or candlestick." I'm also doubtful that the there's as much standardization on the line charts as you claim. Can you back that up with any references? – user32479 Jan 20 '16 at 22:21
  • @Brick, by last traded information, I think George means that the latest highs, lows, open and closes get updated every minute, as he clarifies that in his next 2 paragraphs. Also all the charting softwares I have seen and use incorporate actual data which was traded, not averages. – user9822 Jan 20 '16 at 22:57
  • @MarkDoony I think that "last trade" is common, but I've definitely seen charts that have fractional pennies shown, which could only result from averaging. I doubtful that this is as universal as is being claimed here, although, again, I don't dispute that this is a very common choice. – user32479 Jan 20 '16 at 23:01
0

Charts that are line graphs show an average at that interval, OHLC and Candlestick charts are capable of showing the last matched trade at that instant in time.

If your chart isn't updating based on the last matched trade, then you do not have real-time charts.

In your examples, a line graph will show an average of two points connecting both minute intervals, from 65.66 to 65.78. OHLC and candlestick charts are generated either live at millisecond intervals and frozen at the end of the minute, or by using the four applicable data points from the thousands of matched trades within the last minute to create them.

0

@CQM is correct. But perhaps it didn't quite ask what you were really asking.

If you want the last price it sold for, look at the current dollar price that the stock is selling for, not the chart. That is what the most recent trade went for. The charts try to show those values over time. So the answer is option #1, but charts by nature show an average.

  • @CQM I am not sure why you got downvoted. I disagree with GR, there simply isn't as much standardization as he implies, and Brick brings up some valid points. – cripp Jan 20 '16 at 22:38
  • The accuracy of my answers will rarely match consensus or helpfulness on this site, very rarely do people debate me on accuracy, where I am open to being corrected. People typically debate me on helpfulness or based or letter of the law which the most accurate answer will frequently run counter to. – CQM Jan 21 '16 at 16:10

You must log in to answer this question.

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