nikkei-225.png What is Nikkei 225 (Nikkei 225)? Nikkei 225, also known as the Nikkei Stock Average, is a stock market index that tracks the performance of 225 large publicly traded companies listed on the Tokyo Stock Exchange (TSE). It is one of the most widely recognized and closely watched indices in Japan and around the world. The index was first introduced in 1950 by the Nihon Keizai Shimbun, Japan\u0027s leading financial newspaper, and has since become a barometer of Japan\u0027s economic health. The companies included in the Nikkei 225 are chosen based on their market capitalization, liquidity, and sector representation. The Nikkei 225 is calculated by taking the sum of the stock prices of the 225 companies and dividing it by a divisor that adjusts for changes in the stock prices and changes in the composition of the index. The index is calculated in real-time during trading hours on the TSE. Like other stock market indices, the Nikkei 225 reflects investor sentiment about the overall health of the Japanese economy. A rising Nikkei 225 indicates optimism about Japan\u0027s economic prospects, while a falling Nikkei 225 suggests concerns about economic growth and corporate earnings. Investors can use the Nikkei 225 as a benchmark to evaluate their own portfolio performance or to make investment decisions. Many financial products, such as exchange-traded funds (ETFs) and mutual funds, are based on the Nikkei 225. In addition to its role as a financial indicator, the Nikkei 225 has cultural significance in Japan. Its name comes from Nihon Keizai Shimbun\u0027s former headquarters address in Tokyo\u0027s Nihonbashi district, which was located at 2-25 Nihonbashi-Kabutocho. The index is often referred to simply as \"Nikkei\" in Japan. Overall, the Nikkei 225 is an important index that reflects the performance of Japan\u0027s largest and most influential companies. Its movements are closely watched by investors, economists, and policymakers around the world. 18.jpg The criteria for selecting securities for the Nikkei 225 are: 1. Listing: The company must be listed on the first section of the Tokyo Stock Exchange. 2. Liquidity: The company must have a high trading volume and be actively traded. 3. Market capitalization: The company must have a large market capitalization, which is calculated by multiplying the number of outstanding shares by the current stock price. 4. Industry representation: The index should represent a diverse range of industries and sectors to provide a broad representation of the Japanese economy. 5. Financial stability: The company must have a stable financial position and meet certain financial criteria, such as profitability and debt-to-equity ratio. 6. Corporate governance: The company must have good corporate governance practices and comply with relevant laws and regulations. 7. History: The company must have a proven track record of stability and growth over time. What are the factors driving the price of the Nikkei 225? The price of the Nikkei 225 is influenced by several factors, including: 1. Global economic conditions: The performance of the Nikkei 225 is closely tied to global economic conditions, particularly in major trading partners such as the US and China. Economic growth, trade policies, and geopolitical events can all impact the index. 2. Domestic economic indicators: The performance of the Japanese economy, including GDP growth, inflation, and employment data, can also influence the Nikkei 225. 3. Corporate earnings: The earnings reports and financial performance of the companies listed on the Nikkei 225 can have a significant impact on the index. Positive earnings reports can lead to increased investor confidence and higher stock prices. 4. Monetary policy: The Bank of Japan\u0027s monetary policy decisions, including interest rate changes and quantitative easing measures, can impact the Nikkei 225. 5. Exchange rate fluctuations: Changes in the value of the yen relative to other currencies can affect the performance of Japanese companies and the Nikkei 225. 6. Investor sentiment: Overall investor sentiment and market trends can also play a role in driving the price of the Nikkei 225. What are the components of Nikkei 225? The Nikkei 225 is composed of 225 Japanese companies listed on the Tokyo Stock Exchange. Some of the major components of the index include: 1. Toyota Motor Corporation 2. Sony Corporation 3. SoftBank Group Corp. 4. Mitsubishi UFJ Financial Group, Inc. 5. Honda Motor Co., Ltd. 6. Nintendo Co., Ltd. 7. Mitsubishi Electric Corporation 8. Panasonic Corporation 9. Hitachi, Ltd. 10. Sumitomo Mitsui Financial Group, Inc. The components of the Nikkei 225 are reviewed annually in September and changes are made based on market capitalization and liquidity criteria. istockphoto-1136561750-612x612.jpg Why invest in the Nikkei 225 Index? 1. Diversification: Investing in the Nikkei 225 Index provides diversification benefits as it includes a variety of companies from different sectors, reducing the risk associated with investing in individual stocks. 2. Exposure to the Japanese economy: The Nikkei 225 Index is a good way to gain exposure to the Japanese economy, which is the third-largest economy in the world. 3. Potential for growth: Japan has a highly skilled workforce, advanced technology, and a strong industrial base, which could lead to potential growth opportunities for companies listed on the Nikkei 225. 4. Strong corporate governance: Japan has a reputation for strong corporate governance and transparency, which can be attractive to investors. 5. Currency diversification: Investing in the Nikkei 225 Index provides exposure to the Japanese yen, which can provide currency diversification benefits for traders. However, based on historical data, the Nikkei 225 stock index has seen fluctuations over the years. In the 1980s, the index experienced a significant surge, reaching its all-time high in December 1989. However, it then fell dramatically in the 1990s, a period known as the \"Lost Decade.\" Since then, the index has shown some recovery, with some years seeing significant gains and others experiencing losses. In recent years, the index has been affected by global economic conditions and geopolitical events, such as the US-China trade war and the COVID-19 pandemic. Overall, the trend of the Nikkei 225 stock index has been one of volatility and fluctuation, with periods of growth followed by periods of decline. You can create your own index today using the 8 application. Go see how it works.
Screen-Shot-2020-12-18-at-3.23.58-PM-1.png What is the S\u0026P 500? Current investment We can\u0027t avoid that. The US stock market index influences stock markets around the world. The S\u0026P 500 is the leading indicator of the global economy because it includes the top 500 US companies, representing more than 80% of all US publicly traded companies. As a result, when the S\u0026P 500 index goes up and down, it will have an impact on the world\u0027s financial markets. This article will introduce investors to the US stock index S\u0026P 500, what is the S\u0026P 500, how is the S\u0026P 500 calculated, the list of stocks in the S\u0026P 500, S\u0026P 500 and Dow Jones, and how they differ. What is the S\u0026P 500 and how did it come about? The S\u0026P 500 is a stock market index that tracks the stocks of 500 large US companies, representing the performance of more than 500 companies listed on the American stock market. Examples of companies included in the S\u0026P 500 index are Amazon, American Airlines Group. Bank of America, BlackRock, CME Group, Apple, Facebook, Microsoft, Google and Tesla etc. The S\u0026P 500 was created on March 4, 1957 by Standard and Poor\u0027s, a global financial and credit rating firm, to represent the 500 leading stock indexes. American stock market. As a stock market index, the S\u0026P 500 Index is arguably the best gauge. It tracks 500 large companies traded on the stock exchange. highly liquid Including allowing to buy and sell stocks in the stock market more than 10%, etc., which is the result of considering the S\u0026P500 index. Although the Dow Jones index is the most well-known index, But investors often look to the S\u0026P 500 when they want to gauge how the overall market is doing. Therefore, this index is considered a leading economic indicator of the United States. Over the past 10 years, the S\u0026P 500 has yielded 11.09% per year. As of Jan. 14, 2020, it has a YTD yield of 26.65%. How does the S\u0026P 500 work? The S\u0026P 500 tracks the market capitalization index of companies. Market capitalization (Market cap) is the total value of all shares issued by a company. It is calculated by multiplying the number of shares issued by the share price. A company with a market capitalization of $100 billion will receive 10 times the representation of a company with a market capitalization of $10 billion. The total market capitalization of the S\u0026P 500 is $23.5 trillion. It is worth 80% of the total stock market value. The index is calculated by weighting the company\u0027s market capitalization. It measures only shares that are publicly available. It does not include controlled groups, other companies or government entities. The committee selects each of the 500 companies based on liquidity, size and industry type. The index is rebalanced quarterly in March, June, September and December. The company must be based in the United States and have a market capitalization of at least $6.1 billion, and at least 50% of its stock must be public. The stock price must be worth at least $1 per share. 10-K annual reports must be filed, and at least 50% of fixed assets and revenue must be in the United States, and ultimately must be profitable for at least four consecutive quarters. Stocks must be listed on the New York Stock Exchange, the Investors Exchange, NASDAQ or BATS. They cannot be traded directly between buyers and sellers. (over-the-counter) or trading outside the market (pink sheet) How is the S\u0026P 500 calculated? The S\u0026P 500 uses a market capitalization weighted (market cap) method, providing a higher percentage allocation to companies with the highest market capitalization. 2021-08-14_15-04-06-700x288.png List of stocks in the S\u0026P 500 The list of stocks in the S\u0026P 500 includes 500 common stocks of leading US companies in various industries. The top 20 companies in the S\u0026P 500 as of August 31, 2020 follow. Company name Apple Inc. Microsoft Corporation Amazon.com Inc. Facebook Inc. Class A Alphabet Inc. Class A Alphabet Inc. Class C Berkshire Hathaway Inc. Class B Johnson \u0026 Johnson Visa Inc. Class A Procter \u0026 Gamble Company NVIDIA Corporation Home Depot Inc. JPMorgan Chase \u0026 Co. Mastercard Incorporated Class A UnitedHealth Group Incorporated Verizon Communications Inc. Walt Disney Company PayPal Holdings Inc. Adobe Inc. Pfizer Inc. 81iJwNY3DeL.jpg The face of the S\u0026P 500 industry reflects the state of the economy. Based on the S\u0026P Dow Jones Index as of January 14, 2020, with the S\u0026P 500 group divided as follows: Information Technology 23.2% Health services 14.2% Finance 13% Communication Services 10.4% Luxury consumer goods 9.8% Industrial products 9.1% Essential consumer goods 7.2% Power 4.3% Utilities 3.3% Real estate 2.9% Construction materials 2.7% How are S\u0026P 500 and Dow Jones different? The Dow Jones is another stock market index that features large companies.The highlights of the S\u0026P 500 and Dow Jones are as follows: ยท Dow Jones consists of just 30 companies, each of which is a leader in its respective industry. . The Dow Jones is weighted by the stock price of each company. Not by market capitalization, which means companies with higher stock prices gain more weight. The index is calculated by adding the stock prices of all 30 weighted companies and dividing them by a predetermined constant known as the Dow Divisor. Traders friends, don\u0027t forget to follow the S\u0026P500 index before investing. Because it is an important number that will reflect the market situation each day, ask friends to invest successfully. You can create your own index today using the 8 application. Go see how it works.