Opening of the main index of the Vienna Stock Exchange on February 21

Opening the session without major changes for the ATXwhich begins the session of Tuesday, February 21 with a variation of the 0.04%until the 3,488.99 dots, after opening. By comparing these data with those of past days, the ATX connects three successive dates of descent.

Considering last week, the ATX earn a promotion 0.89%; even if last year it still maintains a decrease of 0.49%. He ATX is located at 0.34% below its maximum this year (3,500.85 points) and a 10.42% above its floor rate for the current year (3,159.71 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 assetsit therefore collects 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 specific characteristics 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. 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 study how company stocks tended to rise or fall together, he created two indices: one that contained the 20 largest railway companies (as it was the largest industry at the time) , as well as 12 shares of other types of companies

Today in humanity there are various indices and they can unionize based on their geography, 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 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 value of the share on the corresponding stock market by the total number of shares that are on the market.

Companies that are in the bag are obliged 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 examining 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 outperformed. However, if the first started the day at 30,000 points and the other at 300, it can be deduced that in percentage terms the gains for the second were higher.

These 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. Likewise, the S&P500, which includes 500 of the largest companies on the New York Stock Exchange. Finally comes the Nasdaq 100that connects 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 the asian continentthe main stock market indices are the Nikki 225, made up of the 225 largest companies on the Tokyo Stock Exchange. Also SSE composite index, which is listed as the most notable in China, consisting of the most important companies on 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 consolidated companies on the Mexican Stock Exchange (BMV). At least a third of them belong to 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.