On screens, stock tickers with three-four-or-sometimes-five-letters move up and down steadily every trading day.
These simple symbols hide the changing emotions of many investors, from fear to hope.
Some tickers do, however, tell a story.
Stock symbols that have stood out for decades include Harley-Davidson HOG, Southwest Airlines LUV and Ferrari RACE.
Few investors consider how much thought went into the names of companies, particularly when they simply use dominant letters, like Nvidia’s NVDA, or Apple’s AAPL.
The ICD takes a look at the unusual ticker symbols of US stock market history, and wonders if creativity in name has anything to do with performance.
Southwest Airlines (NYSE: LUV)
Southwest Airlines’ company history states that “Southwest is in love with its customers from the beginning.”
This theme is deeply rooted.
In the early days of its existence, airline employees issued tickets using machines called “Love Machines”. They wore go-go booties and hot pants, and served passengers “love bites,” which were peanuts and drinks.
Southwest Airlines’ first flight, on June 18, 1971 from Dallas Love Field in Houston and San Antonio to Houston was the inspiration for this symbolism.
LUV’s listing on the New York Stock Exchange was an obvious choice in 1977.
The ticker reflected not only the brand, but founder Herb Kelleher’s egalitarian philosophy.
This philosophy extended to open seating, which the airline had been using for many years but only decided to stop recently.
Harley-Davidson (NYSE: HOG)
Harley-Davidson’s motorcycles are known as “hogs”, a name that dates back to the racing history of the company.
The Harley factory racing team known as Wrecking crew adopted a little piglet to be its mascot in the 1920s.
Riders would do a round with the pig on top of the tank after achieving a victory.
Soon, fans and journalists began calling the Harley Hogs the Harley Hogs. This name became synonymous with both the Harley Davidson brand and its ticker.
Brinker International is a Brinker International company (NYSE:EAT).
Brinker International is the owner of restaurants such as Chili’s Grill & Bar, Maggiano’s and Maggiano’s. It’s widely thought that Norman Brinker personally chose EAT when Chili’s first went public in 1985.
This symbol is a direct reflection of the core business, and it remains as one of the most literal tickers on the stock market.
Dave & Buster’s Entertainment NASDAQ: PLAY
Dave & Buster’s combines casual dining and arcade-style games, which makes PLAY a fitting representation of the business model.
In 1982, founders Dave Corriveau & Buster Corley combined a restaurant & arcade that they ran across the street. The company was formed in 1982 when founders Dave Corriveau and Buster Corley merged a restaurant with an arcade they operated across the street from one another in Arkansas.
PLAY’s identity as an entertainment and leisure destination was clearly defined when the company became public in 2014.
Ferrari (NASDAQ RACE:)
Ferrari’s ticker is a reflection of its motorsport roots, rather than luxury roads cars.
Enzo Ferrari started his career as Alfa Romeo’s race arm, Scuderia Ferraia before founding Auto Avio Costruzioni.
RACE is a short summary of the history and identity of this company.
Some of the other memorable tickers are Canopy Growth WEED, Cedar Fair FUN and Petco Health and Wellness WOOF. Each injects personality into a technical market.
What is in a ticker? Do quirky tickers have an impact on performance?
NYSE limits tickers to three characters, while Nasdaq permits up to five. However, not all companies use the space creatively.
The first stock symbols were used on the ticker tape machines in the early 19th century. At that time, companies with a high volume of trading received single letter identifiers like T, F and X. These are still being used by AT&T and US Steel today.
Some academic research indicates that creativity could be important. While most investors don’t buy stocks solely for their clever tickers, there are some who do.
In a 2006 Princeton University study, psychologists found that stock tickers with easier-to-pronounce symbols often perform better in the first few days following their debut on the market.
Pomona College’s 2019 research confirmed these findings. It showed that investors prefer tickers with clever, memorable names, partly because they are easier to remember.
In a USA Today article, Russell Jame says that there is evidence to support the idea that having an easy-to-process company ticker and name that appeals to investors can be valuable.
It generates more trade in the company, which improves stock liquidity. This also leads to a wider breadth of owners and higher valuation ratios.
One investment advisor said that a ticker was ultimately a brand extension. A little creativity can make a big impact in markets that are driven by the fundamentals.
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