What is Consolidated Tape?

Consolidated tape is an electronic system that collates real-time exchange listed data, such as price and volume, and disseminates it to investors.

Key Takeaways

  • Consolidated tape is an electronic system that collates real-time exchange listed data, such as price and volume, and disseminates it to investors.
  • Through the consolidated tape, various major exchanges, including the New York Stock Exchange, the NASDAQ, and the Chicago Board Options Exchange, report trades and quotes.
  • Each entry on the consolidated tape displays the stock symbol for each company trading on the exchanges, the number of shares traded (volume), the price per share for each trade, and the current price compared to the previous day's close.

Understanding Consolidated Tape

Also known as ticker tape, consolidated tape provides continuous, real-time data generated by various market centers, including stock exchanges, electronic communications networks (ECNs), and third-market broker-dealers.

Through the consolidated tape, various major exchanges, including the New York Stock Exchange, the NASDAQ, and the Chicago Board Options Exchange, report trades and quotes. Securities will often trade on more than one exchange; the consolidated tape reports not just the security’s activity on its primary exchange but the trading activity on all of the exchanges.

Consolidated tape is overseen by the Consolidated Tape Association, and its listed securities data comes from two networks, network A and network B. Network A reports trades for securities listed on the NYSE, while network B reports trades from NYSE Amex, Bats, ECNs, regional exchanges, and the PHLX options exchange.

Each entry on the consolidated tape displays the stock symbol for each company trading on the exchanges, such as the number of shares traded (volume), the price per share for each trade, a triangle pointing up or down, showing whether the price per share is above or below the previous day’s closing price and another number showing how much higher or lower that trade’s price was than the last closing price. The color green indicates a higher trading price and red indicates a lower price; blue or white indicate no change.

Investors can track overall market sentiment by keeping an eye on the consolidated tape. This data also helps technical analysts evaluate stock behavior as they chart the incoming data over time.

The History of Consolidated Tape and Ticker Tape

Consolidated tape comes from the term ticker tape. While tape is digital today, ticker tape got its name originally from the ticking sound emitted by the mechanical machine which printed long strips of paper with stock quotes.

The first telegraphic ticker tape was created by Edward Calahan in 1867. The great American inventor Thomas Edison modified this by improving on its original design, and patented it in 1871. During the late 19th century, most brokers who traded at the New York Stock Exchange had offices located nearby to ensure they received a steady supply of the tape and the most recent transaction figures of stocks. Messengers, or pad shovers, delivered these quotes by running a circuit between the trading floor and brokers' offices. The shorter the distance between the trading floor and the brokerage, the more up-to-date the quotes were.

These mechanical ticker tapes gave way to electronic ones in the 1960s. The consolidated tape was introduced in 1976.