Question

Please pick any stock market index and explain why in has gone up or down in the past two (2) years.

Answer 1

WHAT IS STOCK MARKET INDEX?

Stock market index is the calculation or the measurement of the section of the stock market. It is a tool used to compare the return on specific investments ans used by investors and financial managers to describe the market.

STOCK MARKET INDEX OF DOW JONES INDUSTRIAL AVERAGE

To find whether the index goes up or gone down by one level, or 1%, this means a group or value of stocks has, correspondingly, increased or decreased its value by one level and this may attract or remove the customers accordingly.

The DJIA has done trading on around 30 stocks on New york stock exchange which included walt disney company , microsoft company etc.

The value of the DJIA index amounted to 23,327 (approximate) on November 30, 2018. The index of DJIA is considered to be the barometer of American Economy.

The average daily percentage change in the DJIA for all trading days is only 0.03%. In addition, the average daily gain (0.73%) and average daily loss (-0.75%) are quite similar. Moreover, the number of positive days exceeded negative days by a slim margin of only 1,010 days. Finally, the worst daily percentage loss occurred during one of the greatest bull markets in U.S. history, while the best single-day percentage gain happened during the Great Depression. These last two stats seem counter intuitive, but there is a logical explanation, which we will discuss later. Now we will take a deeper look at the magnitude of the DJIA’s daily gains and losses.

During the last 2 years, the Dow Industrial Average had a rank of 3 with a return of 5%. The top ranked index during the last year was the NASDAQ 100 Index, with a return of 9%. The worst performing index during that period was the DAX Stock Index with a return of -14%. The median return for the indexes during this period was -1%. The average return for all stock market indexes over the year was -1%.

PLEASE GIVE YOUR VALUABLE REVIEWS ABOUT THE ANSWER IN THE COMMENT BOX AND YOU CAN ALSO GIVE THUMBS UP IF YOU LIKE THE ANSWER.

THANK YOU.