share price index


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Stock Index

A group of stocks put together in a standardized way to provide a useful window into a sector or market's performance at a glance. That is, a stock index groups together a certain list of stocks and usually takes an average of their prices so as to provide an idea of how the industry or market represented in the stock index is doing. Very often, stock indices are weighted to prevent a few data points from overwhelming it. For example, the S&P 500 is weighted according to market capitalization, while the DJIA is weighted for price.

share price index

a measure of the change in the average prices of company shares over time. In the UK the Financial Times All-Share Index records day-to-day movements in the average price of all company shares listed on the London STOCK MARKET. The Financial Times 100 share index (FTSE-100), the FTSE-250 share index and the FTSE-350 share index show movements in the share prices of, respectively, the top 100,250 and 350 companies by market capitalization. A similar role is performed in the US by the Dow-Jones Index and the Nasdaq Index, and in Japan by the Nikkei Index

In technical terms, a share price index is compiled by noting the prices of the shares included in the index at some ‘base’ point in time (for example, 2 January 2001) and assigning an index number (say 1000) to begin the series. If share prices generally start to increase then this is translated into an upward movement in the value of the index (for example, the value of the index at 2 January 2002 may be, say, 1500, indicating that share prices on average have increased by 50% over a one-year period). Likewise, general falls in share prices are recorded as a decline in the value of the index.

Share price indices reflect the corporate sector's underlying profit and growth record and also act like a barometer of investor confidence or lack of it, about the state of industry and the economy generally See PRICE INDEX.

share price index

a measure of the change in the average prices of company SHARES over time. In the UK the Financial Times All-Share Index records day-to-day movements in the average price of all company shares listed on the London STOCK EXCHANGE. The Financial Times 100 share index ( FTSE-100), the FTSE-250 share index and the FTSE-350 share index show movements in the share prices of, respectively, the top 100,250 and 350 companies by market capitalization. In the USA share price movements are monitored by the Dow-Jones Index and the Nasdaq Index and in Japan by the Nikkei Index

Share price indices reflect the corporate sector's underlying profit and growth record and also act like a barometer of investor confidence in the state of industry and the economy. See PRICE INDEX.

References in periodicals archive ?
The daily dollar dividend is measured as the closing quotation for the ASX All Ordinaries Share Price Index times the daily dividend yield.
An element of the arbitrage between the futures market and share market is the ability to take short positions in the shares comprising the share price index portfolio.
Since the SPI futures contract is tied to the behaviour of the underlying share price index portfolio, residual risk cannot be hedged.
Violations of the stricter of the lower bounds and the switch from upper (lower) to lower (upper) bound violations are associated with a divergence between the daily rate of return on the SPI futures contract and the daily rate of return on the share price index.
This difference in trading hours introduces a potential bias, in that the closing price for the SPI futures contract may reflect an index value which differs from the closing quotation for the share price index.
The share price index does not include any adjustment for dividends, whereas the accumulation index does.
The construction of the ASX All Ordinaries Share Price Index as a value weighted portfolio implies that the mean bid-ask spread in the share market will misspecify the bid-ask spread for the index portfolio.
Median Mean Standard Deviation % % % ASX Share Price Index 0.
The closing value of the share price index is used in place of the bid and ask prices in estimating the futures price from equation 1.
The daily returns on the SPI futures contracts and the share price index are measured as the natural logarithm of the daily price relative.