Day without changes for the KOSPIwhich ended on Tuesday, February 21 with a variation of the 0.16%until the 2,458.96 points. He KOSPI reached a maximum of 2,466.07 points and a minimum volume of 2,446 points. The trading range for the KOSPI between its highest and lowest point (maximum-minimum) during this day it stood at the 0.81%.
Regarding the last seven days, the KOSPI marks a decrease in 0.27% and in the last year it still accumulates a decrease of 8.13%. He KOSPI a 1.01% below its maximum this year (2,484.02 points) and a 10.83% above its minimum price so far this year (2,218.68 points).
Stock indices… What for?
a stock index is an indicator used to show the evolution of the value of a certain set of assetsfor which you need to have data from different companies or sectors of a fragment of the market.
These indicators are used mainly by the stock markets of various countries and each of them can be integrated by signatures with specific characteristics such as having a similar market capitalization or belonging to the same type of business, in addition, there are some indices that only take into account a handful of shares to determine their value or others that consider hundreds of shares.
Stock indices serve as indicator of confidence in the stock market, business confidence, the health of the national and global economy and the performance of investments in shares and shares of an entity. Generally, if investors are not confident, stock prices tend to fall.
They also work to measure the performance of an asset manager and they allow investors to be able to compare 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 the shares of companies tended to rise or fall together in price, he created two indices: one that contained the 20 largest railway companies (as it was the most important industry at the time), as well as 12 shares of other types of businesses
Currently in humanity there are various indices and they can come together based on their geography, sectors, company size or also the type of assetFor example, the US Nasdaq index is made up of the 100 largest companies mostly related to technology 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 calculating, but the main component is the market capitalization of each company that integrates it. This is obtained by multiplying the daily value of the bond in the corresponding stock market by the total number of shares that are in the hands of investors.
Companies listed on the stock exchange are required to present a balance of its composition. Said report must be notified every three or six months, as the case may be.
Reading a stock index also implies taking into account its changes over time. Current indices always start with a fixed value based on stock prices on their start date, but not everyone follows this method. Therefore, it can appear misleading.
If one index powers up by 500 points in one day, while another only gets 20, it might appear that the former outperformed. However, if the first started the day at 30,000 points and the other at 300, it can be derived that, in percentage terms, the gains for the second were more important.
These are the main stock indices
Between the main stock indices in the American Union is the Dow Jones Industrial Average, better known as Dow Jones, made up of 30 companies. Also, the S&P 500, which includes 500 of the largest companies on the New York Stock Exchange. Finally comes the Nasdaq 100which brings together 100 of the largest non-financial firms.
On the other hand, the most important indices of Europe are the eurostoxx 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; the FTSE 100 from the London Stock Exchange; he ACC 40 from the Paris Stock Exchange; and the IBEX 35from the Spanish stock market.
In the asian continentthe main stock indices are the nikkei 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 main one in China, made up of the most relevant companies on the Shanghai Stock Exchange. Similarly, it is worth mentioning the Hang Seung Index in Hong Kong and the KOSPI in South Korea.
Talking about the latin american regionyou have the CPIwhich contains the 35 most consolidated firms on the Mexican Stock Exchange (BMV). At least a third of them are part of the patrimony of tycoon Carlos Slim.
Another is the Bovespa, made up of the 50 most important companies on the Sao Paulo Stock Exchange; he Merval from Argentina; he IPSA From Chile; he MSCI COLCAP from Colombia; he IBC de Caracas, made up of 6 companies from Venezuela.
Similarly, there are other types of global stock market indices such as the MSCI Latin Americawhich includes the 137 most important companies in Brazil, Chile, Colombia, Mexico and Peru.
Similarly, there is MSCI World, which includes 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 firms on the entire planet.
