positive day for him BIST 100which closed the day on Thursday, April 14, with slight increases in 0.61%until the 2,475.41 points. the BIST 100 scored a maximum volume of 2,485.32 dots and the minimum number of 2,461.54 dots. The trading range for BIST 100 between its highest point and its lowest point (maximum-minimum) during that day was 0.96%.
Compared to the last seven days, the BIST 100 recorded an increase of 5.55%so for a year it has accumulated an increase of 79.91%. and one 33.71% above its minimum valuation for the current year (1,851.38 points).
Stock market indices… what for?
a stock market index is an indicator that measures the evolution of the price of a set of assetsfor which it uses data from different companies or sectors of a market fragment.
These indicators are mainly used by the stock markets of different countries of the world and each of them can be integrated by companies with specific needs like having a similar market capitalization or belonging to the same type of industry, also there are some indices that only take into account 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 a comparison between profitability and risk; measure the opportunities of a financial asset or create portfolios.
This type of indicators began to be used at the end of the 19th century after journalist Charles H. Dow. carefully researched how company stocks tended to rise or fall together, so he created two indices: one containing the top 20 railroad companies (it was the largest industry at the time), as well as 12 shares of other types of companies
Currently, in our economy, 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 is it calculated and how to read them?
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 current value of the security on the corresponding stock market by the total number of shares outstanding in the market.
Listed companies are required to present a balance sheet of its composition. This report must be made public every three or six months, as the case may be.
Reading a stock market index also means analyzing its evolution over time. Current indices always appear with a fixed value based on security prices on your start date, but not everyone follows this method. Therefore, it can be misleading.
If one index gains 500 points in one day, while another only gains 20, it may appear that the first index has outperformed. But, if the first started the day at 30,000 points, and the other at 300, we can conclude that in terms of percentage, the gains for the second were considerable.
What are the main stock market indices?
Between the major US stock indices There’s 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, appears 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 brings together the 50 largest companies in the euro zone. Moreover, the DAX 30, the main German index which contains the most outstanding companies of the Frankfurt Stock Exchange; the FTSE100 the London Stock Exchange; the ACC 40 of the Paris Stock Exchange; and the IBEX 35of the Spanish stock market.
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 is listed as the main in China, consisting of the most important companies of the Shanghai Stock Exchange. The same role played by Hang Seung Index in Hong Kong and the KOSPI in South Korea.
As it concerns the Latin American regionyou have the CPIwhich contains at 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 São Paulo Stock Exchange; the Merval from Argentina; the IPSA From Chile; the CIGB in Bogota; the 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 the MSCI World, which brings together 1,600 companies from 23 developed countries; the MSCI Emerging Markets, made up of more than 800 companies from developing countries; and the S&P Global 100composed of the 100 most powerful multinationals on the planet.