India’s Nifty 50 index closes on February 16

Session without major changes for the Crafty 50which closed the day on Thursday February 16 with a variation of the 0.11%until the 18,035.85 points. He Crafty 50 scored a maximum volume of 18,134.75 points and a minimum volume of 18,000.65 dots. The trading range for the Crafty 50 between its highest point and its lowest point (maximum-minimum) during this day, it was at the 0.74%.

Looking at last week’s data, the Crafty 50 recorded an increase of 0.8%so that last year there is still an increase of 3.8%. He Crafty 50 is located 1.08% below its maximum this year (18,232.55 points) and a 2.45% above its minimum valuation so far this year (17,604.35 points).

Stock market indices… What for?

a stock market index is an indicator that shows how the value of a given set of assets is changingfor which it takes data from different companies or sectors of a part of the market.

These indicators are mainly used by the stock markets of 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 industry, furthermore, 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 an entity. If investors are not confident, stock prices tend to fall.

They are also working to measure the performance of an asset manager and they allow investors to have comparisons between 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 (because it was the largest industry in the era), as well as 12 shares of other types of companies

Today there are various indices and They can join a union according to their geography, their sectors, the size of the companies 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 is a stock index measured?

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 in the hands of the investors.

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

Reading a stock market index also means observing its evolution over time. Current indices always open at a fixed value based on stock prices on their start date, but not everyone follows this method. So it can be confusing.

If one index increases by 500 points in one day, while another adds only 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 deduce that in percentage, the gains of the second were more remarkable.

What are 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, it should be mentioned the Nasdaq 100which associates 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 CAC40 of the Paris Stock Exchange; and the IBEX 35of the Spanish stock exchange.

In the asian continentthe main stock market indices are 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 preeminent of China, consisting of the most relevant companies in 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 influential 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.