A:

Logically and theoretically, the last price traded should be the same as the closing price of a stock. However, the way we trade stocks and the markets we trade them on have undergone numerous innovations over the last decade. Thus, a late-afternoon online search for a closing price or last quote might reveal conflicting results.

The last trade you see at the moment of the close may not truly be the last trade. With many stocks trading heavily at the close, a few minutes are required to process orders and determine which among them was the last trade. Depending on the exchange or quote service, these trades may be posted anywhere from 30 seconds to 30 minutes after the closing bell.

To make matters more perplexing, the closing price you see when you search for a quote online often is a "consolidated quote". This quote is delivered from a system that pulls transactions from all stock exchanges and puts them into one data stream. In addition to a consolidated closing quote, many exchanges, like the NYSE and Nasdaq, offer an official last trade or closing price for trades on their exchanges. Hence, you get what appears to be differing last or closing prices.

Additionally, with the advent of after-hours trading, you may see a "last price" that differs greatly from the "closing price" because the last price in this instance represents the last transaction that occurred in ongoing after-hours trading. In another few moments, the stock may trade again and have a new "last price". Of course, this information could seem puzzling when compared against the unchanging closing price from normal trading hours.

(For more, read Understanding the Ticker Tape, The Tale of Two Exchanges: NYSE and Nasdaq, and After-Hours Stock Price.)

This question was answered by Ken Clark.

RELATED FAQS
  1. I don't understand how a stock has a trading price of 5.97, but when I buy it I have ...

    It might seem logical that the last traded price of a security is the price at which it would currently be trading, but this ... Read Answer >>
  2. Why are the bid and ask quotes usually so far away from each other in after-hours ...

    After-hours trading is defined as the exchange of securities outside of an exchange's specified regular trading hours (usually ... Read Answer >>
  3. What trends and data influence after-hours traders the most?

    Learn about the specific information that after-hours traders review to influence their trading. Read Answer >>
  4. Why does after-hours trading (AHT) exist?

    The advent of the Internet and electronic information exchanges has opened financial market trading to millions of investors ... Read Answer >>
  5. What are the main risks of after-hours trading?

    Trading outside of traditional stock market hours brings some unique risks that you should be aware of. Read Answer >>
Related Articles
  1. Trading

    What Is The Difference Between After-Hours Trading And Late Trading?

    “After-hours” trading and “late trading” both refer to investments made outside of normal business hours. While the two activities sound similar and often take place in similar time frames, the ...
  2. Investing

    Understanding The Ticker Tape

    We explain the meaning and use of that reel of symbols whizzing across your TV or computer screen.
  3. Investing

    What's After-Hours Trading?

    After-hours trading occurs on major exchanges outside of regular trading hours, and takes place between 4:30 and 8 p.m. Eastern time.
  4. Insights

    The NYSE and Nasdaq: How They Work

    Learn some of the important differences in the way these exchanges operate and the securities that trade on them.
  5. Investing

    Understanding Stock Quotes

    All you need to know about understanding stock quotes.
  6. Investing

    Stock Exchanges Around The World

    We tell you about five of the most popular stock exchanges from around the globe.
  7. Insights

    What's an Exchange?

    An exchange is an organized marketplace where securities and other financial instruments are traded.
RELATED TERMS
  1. After-Hours Market Close

    The last transaction and final price of a security that is traded ...
  2. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The ...
  3. Close

    The end of a trading session in financial markets. "Close" refers ...
  4. Opening Price

    The price at which a security first trades upon the opening of ...
  5. Equity Market

    The market in which shares are issued and traded, either through ...
  6. Today's High

    A security's intraday high trading price. Today's high is the ...
Hot Definitions
  1. North American Free Trade Agreement - NAFTA

    A regulation implemented on Jan. 1, 1994, that decreased and eventually eliminated tariffs to encourage economic activity ...
  2. Trickle-Down Theory

    An economic idea which states that decreasing marginal and capital gains tax rates - especially for corporations, investors ...
  3. Derivative

    A security with a price that is dependent upon or derived from one or more underlying assets.
  4. Fiduciary

    A fiduciary is a person who acts on behalf of another person, or persons to manage assets.
  5. Sharpe Ratio

    The Sharpe Ratio is a measure for calculating risk-adjusted return, and this ratio has become the industry standard for such ...
  6. Death Taxes

    Taxes imposed by the federal and/or state government on someone's estate upon their death. These taxes are levied on the ...
Trading Center