Bad day for him Hang Seng (Hong Kong)which ended the session on Tuesday, May 24, with notable falls in 1,75%until the 20,112.10 points. The Hang Seng (Hong Kong) scored a maximum of 20,509.62 points and the minimum number of 19,989.62 points. The trading range for Hang Seng (Hong Kong) between its highest point and its lowest point (maximum-minimum) during this day stood at 2,54%.
In the last seven days, the Hang Seng (Hong Kong) recorded a decrease in 2,38%so that in the last year there is still a decrease in 28,24%. The Hang Seng (Hong Kong) stands one 19,44% below its maximum this year (24,965.55 points) and a 9,22% above its minimum valuation so far this year (18,415.08 points).
What is a stock index and what is it for?
a stock index is an indicator that shows how the value of a set of assets evolvesso it collects data from different companies or sectors of a part of the market.
These indicators are mainly used by the stock markets of different countries of the world and each of them can be integrated by firms with specific characteristics such as having a similar market capitalization or belonging to the same type of industry, also, there are some indices that only take into account a handful of shares to determine their value or others that consider hundreds of shares.
Stock market indices serve as 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, share prices tend to fall.
They also work to measure the performance of an asset manager and they allow investors to be able to compare between profitability and risk; measure the opportunities of a financial asset or create portfolios.
This type of indicators began to be used at the end of the 19th century after journalist Charles H. Dow. carefully analyzed how company stocks tended to go up or down together in price, so he created two indices: one containing the top 20 railroad companies (since it was the biggest industry at the time), as well as 12 actions of other types of businesses
Currently there are various indices and can be aggregated based on geographic location, sectors, company size, or even asset typeFor example, the US Nasdaq index is made up of the 100 largest companies largely 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 it calculated and how to read them?
Each stock index has its own way of being measured, but the main component is the market capitalization of each firm that integrates it. This is obtained by multiplying the value of the day of the share in the corresponding stock market by the total number of shares that are in circulation in the market.
Firms listed on the stock exchange are required to present a balance of its composition. This report must be delivered every three or six months, as appropriate.
Reading a stock index also requires taking into account its changes over time. New indices always start with a fixed value based on the prices of the securities on your start date, but not everyone follows this method. Therefore, it can lead to inaccuracies.
If one index rises 500 points in a day, while another only gains 20, it might appear that the first index performed better. However, if the former started the day at 30,000 points and the other at 300, it follows that, in percentage terms, the gains for the latter were considerable.
These are the main stock indices
Between the main stock indices in the American Union There is the Dow Jones Industrial Average, better known as Dow Jonesmade up of 30 companies., the S&P 500, which includes 500 of the largest companies on the New York Stock Exchange. Lastly, it is worth mentioning the Nasdaq 100which associates 100 of the largest non-financial firms.
On the other hand, the most outstanding indices of Europa are the Eurostoxx 50, which covers the 50 largest companies in the eurozone. In addition, the DAX 30, the main German index that contains 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.
In the asian continentwe have the Nikkei 225, made up of the 225 largest companies on the Tokyo Stock Exchange. Also, the SSE Composite Index, which can be considered the most representative of China, made up of the most relevant companies on the Shanghai Stock Exchange. Similarly, it is worth mentioning the Hang Seung index in Hong Kong and the KOSPI in South Korea.
Talking about the Latin American regionyou have the IPC which contains at 35 most consolidated firms 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, made up of the 50 most important companies on the São Paulo stock exchange; the Merval from Argentina; the IPSA From Chile; the MSCI COLCAP from Colombia; the IBC of Caracas, made up of 6 companies from Venezuela.
Similarly, there are other types of global stock market indices such as the MSCI Latin America which includes the 137 most important companies in Brazil, Chile, Colombia, Mexico and Peru.
Similarly, there is the MSCI World, which includes 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 Global 100made up of the 100 most powerful multinational firms on the planet.
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