Opening of the BSE Sensex 30 index on February 13

Day without changes for the BSE Sensex 30which begins on Monday February 13 with a variation of the 0.05%until the 60,652.16 points, after the start of the opening session. If we compare the data with the previous days, the BSE Sensex 30 add two successive dates in decline.

If we consider the data of the last seven days, the BSE Sensex 30 marks an ascent of 0.24% and in annual terms, it still maintains an increase of 4.92%. He BSE Sensex 30 is located at 1.05% below its maximum this year (61,294.20 points) and a 2.23% above its minimum price for the current year (59,330.90 points).

What is a stock index and what is it used for?

a stock market index is an indicator that measures the change in value of a given set of assetsfor which it takes data from various companies or sectors of a market fragment.

These indicators are mainly used by the stock markets of various countries and each of them can be integrated by signatures with different specificities such as having a similar market capitalization or belonging to the same sector, some indices only take into account a handful of stocks to determine their value or others which take into account hundreds of stocks.

Stock indices serve as indicator of confidence in stock market, business confidence, health of national and global economy and stock investment performance and shares of an entity. Generally, if investors lack confidence, stock prices will tend to fall.

They are also working to measure the performance of an asset manager and allow investors to compare profitability and risk; measure the opportunities of a financial asset or create portfolios.

These types of indicators began to be used at the end of the 19th century after the journalist Charles H. Dow. To carefully analyze how company stock prices tended to rise or fall together, he created two indexes: one that contained the 20 largest railway companies (as it was the most important industry in the era), as well as 12 shares of other types of companies

There are currently various indices and they can cluster based on location, industries, company size, or even asset typeFor example, the U.S. Nasdaq index is made up of the 100 largest companies with broad technology connections 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 calculation method, but the main component is the market capitalization of each company that incorporates it. This is obtained by multiplying the value of the security on the corresponding stock market by the total number of shares that are on the market.

Listed companies are required to present a balance sheet of its composition. This report must be issued every three or six months, as the case may be.

Reading a stock market index also means taking care of its variations over time. Current indices always appear with a fixed value based on security prices on their start date, but not everyone follows this method. Therefore, it may seem misleading.

If one index rises 500 points in one day, while another only gains 20, it may seem that the former has performed better. But, if the first started the day at 30,000 points, and the other at 300, we can conclude that in percentage terms, the gains of the second were higher.

The main stock market indices

Between the main stock indices of the American Union is the Dow Jones Industrial Average, better known as the Dow Jones, made up of 30 companies. Also S&P500, which includes 500 of the largest companies on the New York Stock Exchange. Finally, the Nasdaq 100which includes 100 of the largest non-financial companies.

On the other hand, the most important indices of Europe are the Euro Stoxx 50, which covers the 50 largest companies in the euro area. On the other hand, the DAX 30, the main German index containing the strongest companies on the Frankfurt Stock Exchange; there FTSE100 the London Stock Exchange; he CAC 40 of the Paris Stock Exchange; and the IBEX 35of the Spanish stock exchange.

In Asiawe have the Nikki 225, made up of the 225 largest companies on the Tokyo Stock Exchange. There is also the SSE composite index, which can be considered the main one in China, consisting of the most important companies of the Shanghai Stock Exchange. The same role played by the Hang Seung Index in Hong Kong and the KOSPI in South Korea.

As it concerns the Latin American regionyou have the IPCwhich contains the 35 Most Outstanding Companies on 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 of the Sao Paulo Stock Exchange; he Merval from Argentina; he IPSA From Chile; he MSCI COLCAP Columbia; he IBC of Caracas, made up of 6 companies from Venezuela.

Similarly, there are other types of global stock indices such as the MSCI Latin Americawhich includes the 137 most important companies from Brazil, Chile, Colombia, Mexico and Peru.

Likewise, there is MSCI World, which brings together 1,600 companies from 23 developed countries; he 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 corporations on the entire planet.