Negative day for Taiwan Weightedwhich ended the session on Monday, December 12 with decreases in the 0.67%until the 14,606.58 points. The Taiwan Weighted scored a maximum volume of 14,658.46 points and a minimum of 14,538.66 points. The trading range for the Taiwan Weighted between its highest and lowest point (maximum-minimum) during this day it stood at the 0.82%.
In relation to the last week, the Taiwan Weighted records a decrease in 2.5%therefore in the last year it still maintains a decrease in 17.59%. The Taiwan Weighted a 21.16% below its maximum so far this year (18,526.35 points) and a 15.32% above its minimum price for the current year (12,666.12 points).
Stock indices… What for?
a stock index It is an indicator that shows how the price of a certain set of assets changesfor which it collects data from various companies or sectors of a fragment of the market.
These indicators are used mainly by the stock markets of various nations and each of them can be integrated by companies with different specificities such as having a similar market capitalization or belonging to the same type of industry, likewise, there are some indices that only consider 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 stock investments and shares of an entity. Generally, if investors are not confident, stock values will tend to fall.
They also work 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.
These types of indicators began to be used at the end of the 19th century after the journalist Charles H. Dow. To see carefully how the shares of companies tended to rise or fall together in price, so he created two indices: one that contained the 20 most important railway companies (since it was the most important industry at the time), as well as 12 shares of other types of businesses
Currently there are various indices and They can join a union based on their geographical location, sectors, company size or even the type of assetFor example, the US Nasdaq index is made up of the 100 largest largely technology-related companies 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 factor is the market capitalization of each company that integrates 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.
Firms 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 requires paying attention to its changes over time. Current indices always start with a fixed value based on security prices on their start date, but not everyone follows this method. Therefore, it can lead to failures.
If one index gains 500 points in a day, while another only gets 20, it might appear that the former performed better. However, if the former started the day at 30,000 points and the other at 300, you can see that, in percentage terms, the gains for the latter were considerable.
The main stock indices
Between the major US stock indices is the Dow Jones Industrial Average, better known as Dow Joneswhich is made up of 30 companies, the S&P 500, which includes 500 of the largest companies on the New York Stock Exchange. Finally, one must not forget the Nasdaq 100which unites 100 of the largest non-financial firms.
On the other hand, the most prominent indices of Europe are the eurostoxx 50, which covers the 50 largest companies in the euro area. He too DAX 30, the main German index containing the most outstanding companies on the Frankfurt Stock Exchange; the FTSE 100 from the London Stock Exchange; the 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, is seen as the most solid 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 Latin Americayou have the CPIwhich contains the 35 most outstanding firms of 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; the Merval from Argentina; the IPSA From Chile; the MSCI COLCAP from Colombia; the 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; the 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.