As an intern with the local home builder’s association, you have been asked to analyze the state of the local housing market, which has suffered during a recent economic crisis…..
To what extent do the indices differ in the changes in share prices they show? Why do you think this is?
With a group of friends, each choose a different share price index. Well-known indices you might choose include the Nasdaq Composite Index, France’s CAC 40, Germany’s Dax, Hong Kong’s Hang Seng Index (HSI), Japan’s Nikkei Index, the UK’s FTSE 100 and the USA’s Dow Jones Industrial Average Index.
a For each of the indices, find out how it is calculated and note down its daily values for a one-week period.
b Compare your findings regarding the calculation of your chosen index with those for the indices chosen by your friends, noting down similarities and differences.
c To what extent do the indices differ in the changes in share prices they show? Why do you think this is?