Nikkei 225 opens higher on February 14

Start of the day on the rise for the Nikki 225which begins on Tuesday February 14 with the ascents of the 0.9%until the 27,673.35 points, after opening. If we compare the data with earlier dates, the Nikki 225 it changes the meaning of the previous result, where it marked a drop of 0.31%, without being able to establish a stable trend lately.

Considering the last seven days, the Nikki 225 records a decrease of 0.04%; Despite this, year on year, it still maintains an increase of 0.85%. He Nikki 225 is located 0.07% below its maximum this year (27,693.65 points) and a 7.61% above its minimum price so far this year (25,716.86 points).

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

a stock market index It is an indicator that shows how the price of a certain set of assets is moving.for which it collects data from various companies or sectors of a market fragment.

These indicators are mainly used by the exchanges of each country and each of them can be integrated by companies with certain characteristics 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 prices 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. carefully observed how the stock prices of companies tended to rise or fall together, so he created two indices: one containing the 20 largest railway companies (since this was the largest industry in the world). era), as well as 12 shares of other types of companies

Today in humanity there are various indices and They can associate according to their geographical location, sectors, size of the company or even the type of asset.For 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 calculation method, but the main factor is the market capitalization of each company that incorporates it. This is obtained by multiplying the daily value of the bond 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 being attentive to its evolution over time. New indices always start with a fixed value based on stock prices on their start date, but not everyone follows this method. Therefore, it can be 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 deduce that in percentage, the gains of 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, made up of 30 companies. 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. Also 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 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, is considered the most notable 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 Latin Americayou 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.