About stock index trading
The well-known stock index or stock index is the actual stock market index and also measures the value of a particular part of the stock market. They are calculated based on a weighted average of the prices of selected stocks, which belong to the actual category they represent. Stock indexes can represent a specific stock market, such as Nasdaq, or they can represent the largest cluster of companies in a country, such as the US S&P 500, the UK FTSE 100, or the Japanese Nikkei 225.
The purpose of an index is to show the general economic direction of a particular stock market or a country. However, since stock indexes are composed of many companies, they may be greatly influenced by a specific company's decision or a specific industry.
The weight of each component stock in a stock index varies from stock index to stock index, which means that the calculation method for each stock index is different. Price weight and market value weight are the two main calculation methods for calculating component equity weight.
Below you can see some very popular index categories:
1. Dow Jones (US30) and Nikkei 225 (Japan225) are price-weighted indexes.
2. FTSE 100 (UK 100), ASX200 (Australia 200), Hang Seng Index (Hong Kong 50, DAX (Germany 30), CAC 40 (France 40) and IBEX35 (Spain 35) are some of the major market capitalization weighted indexes.
Introduction to Index
S&P 500 (US500):The S&P500 (US500) stock market index is a Standard & Poor's financial service provided by the American Financial Services Corporation in 1957. It is a leading indicator of the U.S. stock index, and as one of the most commonly used benchmarks for the U.S. stock market as a whole, it occupies approximately 75% of the U.S. stock market through capitalization.
ASX200 (AUS200): The ASX 200 (AUS200) index is listed as a market capitalization weighted stock on the Australian Securities Exchange and belongs to the world's 15 largest group with an average daily turnover of US$4.685 billion. The index includes stocks listed on the Australian Securities Exchange.
Nikkei 225 (JP225): Nikkei 225 (JP225), known as the Nikkei Index, is a stock index of the Tokyo Stock Exchange, the world's third largest stock exchange, with a market value of US$4.09 trillion.
HSI (HK50): HSI (HK50), the Hang Seng Index is a market capitalization weighted stock market index that has recorded the daily culture of the 50 largest companies since 1969. The Hong Kong Stock Exchange (HKEx) is known as the second largest in Asia (and the sixth largest in the world). ) Stock exchange.
FTSE 100 (UK100): The FTSE 100 (UK100) index is part of the London Financial Times 100 Index and contains 100 companies with the highest market capitalization listed on the London Stock Exchange.
NASDAQ 100 (US100): The NASDAQ index is mainly the NASDAQ composite index and the Nasdaq 100 index (US100), including stocks issued by the 107 most powerful non-financial companies listed on the Nasdaq Stock Exchange.
DJIA (US30): DJIA (US30), is the second-largest stock index in history after the Dow Jones Transportation Average of the United States. It is composed of 30 major major US companies stocks during the standard trading hours of the stock market. It is calculated by dividing the Dow Jones Industrial Average by the sum of all the prices of 30 representative stocks.
DAX (GER30): DAX (GER30), a German stock index, is a major stock market index in Germany, representing 30 major companies listed on the Frankfurt Stock Exchange. It is considered a blue chip index in terms of quality and profitability.
CAC 40 (FRA40): The French benchmark stock market index CAC 40 (FRA40) belongs to the Paris Stock Exchange and represents the top 40 values of the stocks of the 100 highest market capitalization companies traded on the French stock market, Paris, the second largest exchange in Europe. The highest stock index.
