Stock Market Index / Major World Indices


The purpose of these indices is to trade the stocks between them, using the Spread strategy; but of course, you don't have to do that. Each index hold stocks from other markets in order to diversify investments, thus lessening the risk from any single market.

More About Stock Market Index / Major World Indices

Continue reading to learn more about:

What are today's stock market indices?
What do stock market indexes indicate?
What are the 4 major indices?
What are international stock indexes?


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What are today's stock market indices?


The term index generally refers to a collection of securities that are selected and weighted to track the performance of a particular stock market, bond market or other benchmark. An index is a numerical measure that is calculated based on the value of the securities in an index fund. The methodology and components can vary across different types of indices, depending on the purpose of the index and the strategy of the management team behind it.


 
 

What do stock market indexes indicate?


Stock market indexes provide information about the economy of the United States and other countries. They are measures of the values of certain stocks: how much corporations are worth. Many people use indexes in buying and selling stocks because indexes help compare stock prices over a period of time. For example, if today many companies are selling for more money than they were a year ago, it might mean that the U.S. economy is improving because many companies are doing well financially.

 

What are the 4 major indices?

The four major indices are the Dow Jones Industrial Average, the S&P 500, the NASDAQ Composite and the FTSE 100.

Dow Jones Industrial Average (DJIA)

is a price-weighted index where stocks in large companies have more impact on the final.

S&P 500 Index (SPX)

is an index of 500 of the largest U.S.-based publicly traded companies and includes reinvested dividends. It is weighted by market capitalization and sales data as well as other factors.

NASDAQ 100 (NDX)

tracks over 5,000 stocks traded primarily on the NASDAQ Stock Market and does not include reinvested dividends. It can also be called "technologically based" because it consists of companies involved in technology development such as computer hardware and software producers, semiconductor firms, telecommunications companies, biotechnology firms and more.

FTSE 100 Index

is similar to the Dow Jones Industrial Average.

 

What are international stock indexes?


International stock indexes are indices of the largest and most widely traded companies. They are a way of measuring the performance of the international economy, tracking the activity of thousands of businesses in dozens of countries. Each one is weighted according to its economic significance or market capitalization, meaning that larger companies have a greater impact on the index.