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Opening of the main Lisbon index on August 19 next

Open follow-up session for PSI 20the session begins on Friday, August 19, with a change of the 0.03%to the 6,271.48 points, after the start of the open session. If we compare the figure with the previous days, the PSI 20 have five consecutive dates of positive values.

Compared to last week, the PSI 20 an increase was recorded 1.68%so that last year is still rising 17.43%. The IS PSI 20 one stands 1.22% below its maximum this year (6,349.21 points) and a 17.62% above its minimum valuation for the current year (5,331.85 points).

What is a stock index and what is it for?

stock index it is an indicator that measures the evolution of the value of a set of assetsfrom which it collects data from different companies or sectors of a part of the market.

These indicators are mainly used by the stock exchanges of different countries and firms with different specialties can integrate each for example having a similar market capitalization or belonging to the same type of industry, in addition, 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 entity shares. If investors lack confidence, stock values ​​tend to fall.

They also work for the asset manager performance and allowing investors to analyze comparisons between return 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

Today in humanity there are various indices and they can be consolidated according to their geographical location, their sectors, the size of the companies or the type of assetFor 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 to read an index?

Each stock index has its own way of calculation, but the main factor is the market capitalization of each company that integrates it. This is obtained by multiplying the day’s value of the title on the corresponding stock market by the total number of shares held by the investors.

Companies listed on the stock exchange are required to present a balance of its composition. That report must be disclosed every three or six months, as the case may be.

Reading a stock index also involves examining its changes 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 failures.

If one index grows by 500 points per day, while another index only adds 20, it may appear that the first index performed better. However, if the first day started at 30,000 points and the next day at 300, it can be concluded that, in percentage terms, the gains for the latter were more significant.

These are the main stock indices

Between the major US stock indexes There is the Dow Jones Industrial Average, better known Dow Jones, which consists of 30 companies. Also, the S&P 500, including 500 of the largest companies on the New York Stock Exchange. Finally, there is the Nasdaq 100which unites 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. On the other hand, the DAX 30, Germany’s main index of the largest outstanding 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 Asiathe IS Nikkei 225, comprising the 225 largest companies on the Tokyo Stock Exchange. The IS SSE Composite Index, which can be considered the main one in China, consists of the most important companies on the Shanghai Stock Exchange. The same role played by Hang Index Seung in Hong Kong and the KOSPI in South Korea.

Talking about it Latin American regionthe IS IPCin which swelling Top 35 companies on the Mexican Stock Exchange (BMV). At least a third of them are owned by magnate 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.

Also, there are other types of global stock 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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