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Comparing The S&P 500, NASDAQ & The Dow

COMPARING THE NASDAQ THE DOW S&P 500 DOW JONES INDUSTRIAL AVERAGE DJIA or The Dow Along with the NASDAO COMPOSITE NASDAQ Composite, S&P s00 the S&P 500 Index, and the Russell 2000 RUSSELL 2000 Index, the Dow is O THE DOw among the most closely watched U.S. Shows and tracks the daily trading movements of benchmark indices. 30 large publicly owned US based companies. II S&P DOWJONES INDICES MAY 26 MCGRAW HILL FINANCIAL 2nd Oldest US Founded by Charles First calculated on Currently owned by market index Dow May 26th, 1896 S&P Dow Jones Indices The "Industrial" portion of its name is mostly historical; many of the 30 component FACT companies today have little to do with industrial machinery. Σ where, p are the prices of the DJIA component stocks. The Dow is a Price Weighted Index as the member companies are weighted in where, d is the DOW divisor. proportion to their price per share. Stocks with a higher price will be given more weight and, therefore, will have a This divisor changes to reflect stock greater influence over the performance of the index. splits or dividends to generate a consistent value for the index. THE STANDARD & POOR'S 50O S & P 500 S&P DOW JONES INDICES MCGRAW HILL FINANCIAL The S&P 500 index components and their weightings are calculated by S&P Dow Jones Indices. A stock market index based on the market capitalizations of 500 large companies having common stock listed on the NYSE or NASDAQ. Widely considered one of the best representations of the U.S. stock market. First calculated in 1923. 1923 2000 1500 10 1Õ10L 010 1000 On August 26, 2014, the index for the first time 500 closed above 2000 Technology has since enabled the AUG index to be calculated in real time. 26 E(p q). where P is the price of each stock S&P500 in the index and Q is the number of shares publicly available for each stock. S&P 500 is a Capitalization- Weighted Index as components are weighted according to the total market value of their outstanding shares. The divisor is adjusted in the case The larger the market weight of a company, the more of stock issuance, spin-offs or similar structural changes, impact each 1% change will have on the index. to ensure that such events do not in themselves alter the numerical value of the Index. NASDAQ COMPOSITE A stock market index based on the market capitalizations of 3000+ common equities listed on the Nasdaq stock exchange. 5000 100 2500 1971 1250 The NASD on 5th Feb 1971 launched 625 On March 10, 2000, the closed at an all-time high the index, with a starting value of of 5,048.62 100. MAR 10 NASDAQ OMX This index is highly followed in the U.S. as an The index is owned by The NASDAQ indicator of the performance of stocks of OMX Group technology companies and growth companies. (p q) where P is security's NASDAQ:COMP Last Sale Price and q is do number of shares NASDAQ Composite is a outstanding for that Market Capitalization- Weighted Index. security. The divisor is adjusted for changes to the index. FACTORS INFLUENCING INDEX MOVEMENTS Corporate and Domestic and foreign War and Natural disasters economic reports political events terrorism potentially leading to economic impact INVESTING IN INDEXES EXCHANGE TRADED FUNDS DERIVATIVES Open futures contracts and futures Track the average, investors gain contracts allow investors to invest value through market timing or based on future and present value. broad market growth. TIM TIMOTHYSYKES.COM Sources: http://en.wikipedia.org/wiki/Dow_Jones_Industrial_Average http://en.wikipedia.org/wiki/S%26P_500 http://en.wikipedia.org/wiki/NASDAQ http://money.cnn.com/data/markets/dow/ http://www.nasdaq.com/ http://us.spindices.com/ https://indexes.nasdaqomx.com/docs/methodology_COMP.pdf http://www.stocks-for-beginners.com/nasdaq-composite-index.html ш

Comparing The S&P 500, NASDAQ & The Dow

shared by eshagoyal24 on Oct 04
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Tim via this infographic demonstrates the unique features of these indexes and how they can help in investing.

Publisher

Timothy Sykes

Designer

Esha Goyal

Tags

nasdaq

Category

Economy
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