good opening for Nikkei 225which begins Friday, August 19, with small increases in 0.46%to the 29,076.50 points, after opening. As for today’s changes in relation to past days, the Nikkei 225 changes in the meaning of the previous data, when it marked a decrease of 1.23%, being able to establish a clear trend in the last few days.
Considering last week, the Nikkei 225 rising scores of 1.85%so that in the past year there has still been an increase in 4.26%. The IS Nikkei 225 one stands 0.87% below the maximum so far this year (29,332.16 points) and a 17.64% above its minimum valuation for the current year (24,717.53 points).
Stock market indices… what?
stock index It is an indicator that shows how the value of a certain set of assets changesfrom 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 each country and firms with specific characteristics can integrate each for example having a similar market capitalization or belonging to the same type of 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 allowing investors to compare 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 closely 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 most more at the time), as well as 12 acts of other types. of affairs
Today there are various indexes and They can be grouped based on their 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 to read an index?
Each stock index has its own way of measuring it, but the main component is the market capitalization of each company that integrates it. This is obtained by multiplying the day’s value of the bond on 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. This report must be delivered every three to six months, as the case may be.
Reading a stock index also involves analyzing its variations over time. Current indices are always open with a fixed value based on stock prices on your start date, but not everyone follows this method. Therefore, it can be misleading.
If one index gains 500 points in one day, and another index gains only 20, it may appear that the first index has outperformed. 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 greater.
What are the main stock indices?
Between the major US stock indexes There is the Dow Jones Industrial Average, better known Dow Jonesmade up of 30 companies., the S&P 500, including 500 of the largest companies on the New York Stock Exchange. Finally comes the Nasdaq 100which brings together 100 of the largest non-financial firms.
On the other hand, the most important indexes of Europe is the Eurostoxx 50, covering the 50 largest companies in the eurozone. In addition, 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 main stock indices are the 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 prominent 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 Americathe IS IPCin which swelling 35 most powerful companies of the Mexican Stock Exchange (BMV). At least a third of them are part of the estate of 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 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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