bad day for him FTSE 100 (United Kingdom)which begins the session on Friday, August 19, with small reductions in 0.23%to the 7,524.21 points, after opening. As for past dates, the FTSE 100 (United Kingdom) it reverses the result of the previous session, in which it closed with an increase of 0.27%, indicating that it has not been able to establish a clear trend in recent years.
As for the last seven days, the FTSE 100 (United Kingdom) raise scores 0.31%so that for a year it is still rising 6.59%. The IS FTSE 100 (United Kingdom) one stands 1.93% less than the maximum so far this year (7,672.40 points) and a 8.11% above its minimum price for the current year (6,959.50 points).
What is a stock index and what is it for?
stock index it is an indicator that shows how the value of a certain set of assets changesfor which it takes data from different companies or sectors of a part of the market.
These indicators are mainly used by the stock markets of different countries around the world and each of which can be integrated with signatures with certain characteristics for example having a similar market capitalization or belonging to the same industry, also, there are some indexes that consider only a handful of shares to determine their value or others that consider hundreds of shares.
Stock market indices act as an indicator of confidence in the stock market, business confidence, the health of the national and global economy and the performance of investments in shares and company shares. If investors lack confidence, stock values tend to fall.
They also work for the asset manager performance and they allow to be able to compare profitability and risk; the opportunities of measuring a financial asset or creating portfolios.
This type of indicators began to be used at the end of the 19th century after journalist Charles H. Dow. He looked carefully at how company stocks tended to go up or down together in price, so he created two indexes: one of the top 20 railroad companies (since it was the industry’s largest more at the time), as well as 12 acts of other types. of affairs
Currently there are various indexes and they can be grouped by location, sectors, company size or even asset typeFor example, the US Nasdaq index consists of the 100 largest companies mainly related to technology such as Apple (AAPL), Microsoft (MSFT), Amazon (AMZN), Facebook (FB), Alphabet (GOOG), Tesla (TSLA ). , Nvidia (NVDA), PayPal (PYPL), Comcast (CMCSA), Adobe (ADBE).
How is a stock index measured?
Each stock index has its own way of measuring it, but the main factor is the market capitalization of each firm that integrates it. This is obtained by multiplying the day’s value of the share in the corresponding stock market by the total number of shares in circulation in the market.
Companies listed on the stock exchange are required to present a balance of its composition. That report must appear every three to six months, as the case may be.
Reading a stock index also means analyzing its evolution over time. Current indexes always start with a fixed value based on stock prices on your start date, but not everyone follows this method. Therefore, it can lead to inaccuracy.
If one index gains 500 points in one day, and another index adds only 20, it may appear that the first index has outperformed. However, if the first day started at 30,000 points and the next at 300, it can be assumed that, in percentage terms, the gains for the latter were more important.
What are the main stock indices?
Between the major stock indices in the American Union There is the Dow Jones Industrial Average, better known Dow Jones, which includes 30 companies. Also, the S&P 500, comprised of 500 of the largest companies on the New York Stock Exchange. Finally, do not forget the 100 headsto associate 100 of the largest non-financial firms.
On the other hand, the most significant indexes of Europe is the Eurostoxx 50, covering the 50 largest companies in the eurozone. In addition, the DAX 30, the main German index containing the most prominent companies on the Frankfurt Stock Exchange; the FTSE 100 from the London Stock Exchange; the CAC 40 of the Paris Stock Exchange; and the IBEX 35of the Spanish stock market.
I continent of Asiathe IS Nikkei 225, comprising the 225 largest companies on the Tokyo Stock Exchange. The IS SSE Composite Index, listed as the most prominent in China, consists of the most relevant companies on the Shanghai Stock Exchange. Similarly, it is worth mentioning the Hang Index Seung in Hong Kong and the KOSPI in South Korea.
Talking about it Latin Americathe IS IPCin which swelling 35 most influential companies of the Mexican Stock Exchange (BMV). At least a third of them belong to the capital of the tycoon Carlos Slim.
Another is the bovespa, composed of the 50 most important companies on the São Paulo stock exchange; the Merval from Argentina; the IPSA From Chile; the COLCAP MSCI from Colombia; the IBC de Caracas, made up of 6 companies from Venezuela.
Likewise, there are other types of global stock market indices such as the MSCI Latin Americawhich includes the 137 most important companies in Brazil, Chile, Colombia, Mexico and Peru.
Likewise, the MSCI World, including 1,600 companies from 23 developed countries; the MSCI Emerging Markets, made up of more than 800 companies from developing countries; and the S&P World 100made up of the 100 most powerful multinationals in the world.
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