Bearish session for the FTSE MIB IDX which opens the session on Thursday June 9 with falls of the 0,94%until the 24,009.35 points, after opening. Regarding the changes of this day with respect to past days, the FTSE MIB IDX adds three successive dates in decline.
Taking into account the last week, the FTSE MIB IDX accumulates a decrease in 1,71%so that for a year it has still maintained a drop in 6,82%. The FTSE MIB IDX stands one 14,75% below its maximum this year (28,162.67 points) and a 8,34% above its minimum price so far this year (22,160.28 points).
What is a stock index and what is it for?
a stock index is an indicator used to show the evolution of the value of a given set of assets for which it collects data from various companies or sectors of a part of the market.
These indicators are mainly used by the stock exchanges of the countries and each of them can be integrated by companies with different specificities such as having a similar market capitalization or belonging to the same industry, likewise, there are some indices that only consider 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 shares of an entity. Generally, if investors lack confidence, share prices tend to fall.
They also work to measure the performance of an asset manager and allow investors to analyze comparisons between return 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
Today there are various indices and they can be associated based on their geography, sectors, company size or even the type of assetFor 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 calculating, but the main component is the market capitalization of each company that integrates it. This is obtained by multiplying the value of the day of the bond 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. Said report must be disclosed every three or six months, as appropriate.
Reading a stock index also implies analyzing its evolution over time. Current indices 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 gains 500 points in one day, while another only adds 20, it might appear that the first index outperformed. But, 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 higher.
What 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 Jones which is made up of 30 companies., the S&P 500, comprising 500 of the largest companies on the New York Stock Exchange. Finally comes the Nasdaq 100 which links 100 of the largest non-financial firms.
On the other hand, the most important indices of Europa are the Eurostoxx 50, which covers the 50 largest companies in the eurozone. He too DAX 30, the main German index that contains the most 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 35 of the Spanish stock market.
In Asiawe have the Nikkei 225, made up of the 225 largest companies on the Tokyo Stock Exchange. There is also the SSE Composite Index, which is listed as the most representative in 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 belong to the capital 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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