Index comes in various forms and purposes. The stock market indexes measure the respective value of a group of company shares. In other words, they indicate the performance of stocks. Price indexes, on the other hand, typically stand for weighted averages of prices for certain categories of goods and services. They illustrate the fluctuation of prices in a particular area and during a defined period of time.
Stock market indexes may be tentatively categorized as global, national, and specific. The national indexes reflect the performance of stocks in a particular state. The best known national indexes are the American, DJIA (Dow Jones Industrial Index), UK FTSE 100, and the German DAX (Deutscher Aktien IndeX), among others. Global indexes reflect the international performance of stocks. The Dow Jones, in particular, reflects the trading of large public companies. Its average is calculated, based on the stock of the thirty largest companies in the US such as American Express, IBM, and Hewlett-Packard. One of the most quoted indexes is the S&P Global 500 Index. The latter includes five hundred public companies with operations in multiple countries. Its stocks are traded on the NYSE Euronext and on the NASDAX OMX. Specialized indexes track the performance of stock in specific sectors of the economy. They may be focused on particular fields, such as metallurgy, or they may track firms of certain scope, region, management particularities, and others characteristics.
As suggested, price indexes stand for the average price of goods and services. They are used to measure the cost of living in a certain country. The Consumer Price Index reflects the average price of consumer (mass market) services and goods that are purchased by the households of a certain region. The index follows the fluctuation of prices for a constant market basket of products and indicates the level of inflation in a particular economy.
Free charting webinar
Mon, Nov 18th, 2013 12:00 PM - 1:00 PM EST
During the 60 minute session Paul Coghlan, founder of Coghlan Capital, looks at current charts for currencies, precious metals, US indices, highlighting turns and low risk entry points using the Median line analysis methodology.
Median line analysis reduces risk and increases the chartists ability to see trend direction, trend strength and highlight entry and exit levels.
Seats are limited so be sure to reserve your spot today. The webinar will be recorded, by signing up you'll receive an email with the webinar replay afterwards.