Friday, February 10, 2012

the Benefits of Stock Index

After knowing what the index is, then we also need to know the benefits of the index, in particular stock index. Here are the stock index benefits.

Index as a benchmark of investment evaluation
the Capital and financial market index are indicators of changes that give you an idea of what is happening in the market. Thus we can answer the critical questions posed at the beginning of this post. Armed with the index, which is an objective measure as a reference or comparison of investment results have been obtained, then the success or failure of an investment strategy can be measured objectively.

We can see each issuer's stock price. From there it will look stock which has increased or decreased within a specified period. If we have stock that rose above the composite stock index, then we have a great success in our stock investment.

Index as a Tool for Investment Monitor
Investors should not wait until the end of the year to evaluate its investment activities. Because index is also an effective indicator to help investors in monitoring the investment. If an investor diligently observe the stock index every month and always compare the price of the shares was holding in the period, then he will know whether the growth of investment in shares which he held down continuously below the average stock price traded at the exchange or actually rose.

On the other hand, if in one period of the composite stock price index continued to rise consistently seen, a rise in the index was show how many other stocks whose prices rose sharply and the number of gains. Armed with the information presented by the composite stock index so that investors may start looking for other stocks that caused the stock price index rises. The trick is to find a list of stocks that were included in the calculation of the composite stock index movements and observe stocks that have a big impact on the movement of the composite stock index.

From the analysis of stocks that are members of the calculation of composite stock price index, the investor will find other stocks that could potentially provide benefits. And it is not impossible that investors can make the decision to sell their shares and buy other more profitable shares. From the analysis, we can invest wisely.

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1 comments:

nice. very informative. now, i dont need to ask someone about index.

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