BSE Sensex 30 opened with a downward trend on February 17

bad day for him BSE Sensex 30which begins the day on Friday, February 17 with slight decreases in 0.45%until the 61,043.23 dots, after the start of the opening session. Regarding the past days, the BSE Sensex 30 it is slowing down with the positive sequence of market prices over the last three sessions.

If we consider the data of the last seven days, the BSE Sensex 30 recorded an increase of 0.59%so that year-over-year there is still an increase of 8.22%. He BSE Sensex 30 is located 0.45% below its maximum this year (61,319.51 points) and a 2.89% above its minimum price for the current year (59,330.90 points).

Stock market indices… What for?

a stock market index It is an indicator that is used to know the evolution of the value of a certain set of assetsfor which it takes data from different companies or sectors of a part of the market.

These indicators are mainly used by stock exchanges in various countries and each of them can be integrated by signatures with different specificities like having a similar market capitalization or belonging to the same type of company, similarly, some indices only consider a handful of stocks to determine their value or others that consider 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 the company. Generally, if investors are not confident, stock values ​​will tend to fall.

They are also working to measure the performance of an asset manager and allow investors to make comparisons between return 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 see carefully how company stocks tended to rise or fall together in price, he therefore created two indices: one that contained the 20 largest railroad companies (since that was the largest industry at the time), as well as 12 shares of other types of companies

Today there are various indices and They can be grouped according to their location, their sectors, the size of the company or the type of assetFor 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 to read an index?

Each stock index has its own way of being measured, but the main component is the market capitalization of each company that incorporates it. This is obtained by multiplying the daily value of the security on the corresponding stock market by the total number of shares outstanding on the market.

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

Reading a stock market index also requires being attentive to its evolution over time. Current indices always open at a fixed value based on security prices on their start date, but not everyone follows this method. It can therefore be a source of misunderstanding.

If one index gains 500 points in one day, while another only gains 20, it may seem that the former has performed better. However, if the first started the day at 30,000 points and the other at 300, we see that in percentage terms, the gains for the second were greater.

These are the main stock market indices

Between the major US stock indices is the Dow Jones Industrial Average, better known as the Dow Jones, of which 30 companies are part. Likewise, the S&P500, which includes 500 of the largest companies on the New York Stock Exchange. Finally, we must mention 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 most outstanding 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 is listed as the most representative of 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 Powerful 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.

In addition, 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.