What controls the index and the numbers. How does an individual or a common man gain from the business. Do I have a stake if I dont trade in the business. If I dont gain isnt the business only for a few individuals. Can this business be called as a legalised gambling. Explain.
2007-03-06 22:58:06 · 2 answers · asked by jaiswalhema 2 in Business & Finance ➔ Investing
Any Stock exchange selects some key shares depending on their size, volume of business etc. Their total cost on a a particular date is related to a base index of say 100. The prices of the share are continuously monitored. The ratio of current total price of such selected shares as compared to the selected base is given as an index. It is the market that controls. Each of the selected share is given a appropriate weight depending on its average volume of business over a selected period of time within the base index. Whenever the no of trades on a particular share declines then it is substituted by a share of higher volume of trade. When the price of share with higher weight fluctuates widely, then the index also fluctuate correspondingly. It has no relation to any of the investments you make.
Only in the case of Index mutual funds, the indexes have some relation to the investment- return; because the index funds invest in the share of forming part of the index in the same ratio.
2007-03-07 13:28:04 · answer #1 · answered by Gopalakrishnan P 3 · 0⤊ 0⤋
Gambling first
There with diff of second ur amt turns zero
mkt - time for exit limited loss
mkt -psy part of fear & greed is imp
with knowledge all can win
more on my blog or mail me
2007-03-07 10:41:39 · answer #2 · answered by dinu_pawar 5 · 0⤊ 0⤋