The reference index of the Mexican market opens its day on November 28 with a rise of 0.27%

Good start to the day for the Mexican S&P/BMV IPC index, which begins on Monday, November 28, with slight increases in the 0.27%until the 51,807.50 points, after opening. Regarding past days, the Mexican S&P/BMV IPC index interrupts the negative streak of market prices of the last two days.

In the last week, the Mexican S&P/BMV IPC index registered a rise of 0.46%so that from a year ago it still maintains a rise of 4.24%. The Mexican S&P/BMV IPC index stands a 8.48% below its maximum this year (56,609.54 points) and a 16.09% above its minimum price so far this year (44,626.80 points).

Stock indices… What for?

a stock index is an indicator that shows how the value of a set of assets evolvesfor which it takes data from different companies or sectors of a fragment of the market.

These indicators are used mainly by the stock markets of different countries of the world and each of them can be integrated by signatures with specific characteristics such as having a similar market capitalization or belonging to the same industry, likewise, there are some indices that only take into account 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 investments in shares and shares of a company. Generally, if investors are not confident, stock costs tend to fall.

They also work to measure the performance of an asset manager and allow investors to make 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 carefully analyze how the shares of companies tended to rise or fall together in price, he created two indices: one that contained the 20 largest railway companies (as it was the most important industry at the time), as well as 12 shares of other types of businesses

Today in our economy there are various indices and They can be grouped according to their geography, sectors, company size or also the type of assetFor example, the US Nasdaq index is made up of the 100 largest companies mostly related to technology such as Apple (AAPL), Microsoft (MSFT), Amazon (AMZN), Facebook (FB), Alphabet (GOOG), Tesla (TSLA ), Nvidia (NVDA), PayPal (PYPL), Comcast (CMCSA), Adobe (ADBE).

How is a stock index measured?

Each stock index has its own calculation method, but the main component is the market capitalization of each company that integrates it. This is obtained by multiplying the daily value of the bond in the corresponding stock market by the total number of shares that are in the market.

Companies that are listed on the stock market are required to present a balance of its composition. Said report must come to light every three or six months, as appropriate.

Reading a stock index also requires examining 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. So it can be confusing.

If one index boosts by 500 points in one day, while another only adds 20, it might appear that the former performed better. However, if the first started the day at 30,000 points and the other at 300, it can be concluded that, in percentage terms, the gains for the second were more remarkable.

What are the major stock indices?

Between the main stock indices in the American Union is the Dow Jones Industrial Average, better known as Dow Joneswhich is made up of 30 companies, the S&P 500, which comprises 500 of the largest companies on the New York Stock Exchange. Finally, one must not forget the Nasdaq 100which associates 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. On the other hand, the 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 Asiawe have the nikkei 225, made up of the 225 largest companies on the Tokyo Stock Exchange. Also, the SSE Composite Index, which is listed as the most solid in China, made up of the most prominent 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 the latin american regionyou have the CPIwhich contains the 35 most consolidated firms on the Mexican Stock Exchange (BMV). At least a third of them are owned by 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.

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