Secret Behind Composite Stock Price Index

Every day, either online news, television, radio and other mass media, I declare or inform the Composite Stock Price Index (CSPI) is the latter case. This means the development of stock exchanges can continue to be followed only through the composite stock price index, as if an information has been explained in brightly lit situations all the stock exchanges that are so complex. It could be argued that JCI Index function very effectively. Then there's the secret behind what is JCI?

Composite Stock Price Index is like a thermometer is not available in boxes of medicines in our homes. Its function is to provide a measure that helps us see the "temperatures" economy that has occurred. Temperature "economic" our bodies are hot, cold, or normal. If the "economy" is a high fever above 38 degrees Celsius, it should be immediately taken to the hospital to deal with doctors. Thus, we avoid the risk of death.

Composite Stock Price Index is an indicator of health of equity markets that describe the current condition of the stock exchange. If the stock index continues to rise, it can be said that the state of capital markets is good, economic conditions, social, and political, are in a safe and healthy situation. Stock price index is a summary of the effects of simultaneous and complex range of factors that influence, particularly economic phenomena.

JCI role for Investors
Investors often use as a benchmark stock index investing. By CSPI, investors can determine whether this is a good time to invest in a country or the right moment to attract capital. The increase in stock price index, which takes place continuously indicates the market is bullish (up) or the index of stock prices always go down is an indicator that the market is bearish (down).

Definition Stock Price Index
Stock price index numbers are numbers that a measure of capital market situations that can be used to compare events and as a magnifying glass or analysis tools. By analyzing the changes in price indexes, we analyze the overall stock.

How to View Composite Stock Price Index
Here is how to view the composite stock price index. Positive numbers that accompany changes in stock price index is the increase in stock price indices previously. Negative numbers indicate the stock price index down compared to the previous stock price index. If the stock price index does not change, it indicates that the condition is stable.

JCI formula = Accumulation H1x100% / Accumulation Ho

H1 = The entire amount of stock prices last

Ho = Total stock price at bottom