Nikkei 225

Logarithmic-scale graph of the Nikkei 225 from 1914 to 2012

The Nikkei 225 (日経平均株価 Nikkei heikin kabuka, 日経225), more commonly called the Nikkei, the Nikkei index, or the Nikkei Stock Average[1][2] (/ˈnɪkeɪ/, /ˈniːkeɪ/, or /nɪˈkeɪ/), is a stock market index for the Tokyo Stock Exchange (TSE). It has been calculated daily by the Nihon Keizai Shimbun (Nikkei) newspaper since 1950. It is a price-weighted index (the unit is yen), and the components are reviewed once a year. Currently, the Nikkei is the most widely quoted average of Japanese equities, similar to the Dow Jones Industrial Average. In fact, it was known as the "Nikkei Dow Jones Stock Average" from 1975 to 1985.[3]

The Nikkei 225 began to be calculated on September 7, 1950, retroactively calculated back to May 16, 1949. Since January 2010 the index is updated every 15 seconds during trading sessions.

The Nikkei 225 Futures, introduced at Singapore Exchange (SGX) in 1986, the Osaka Securities Exchange (OSE) in 1988, Chicago Mercantile Exchange (CME) in 1990, is now an internationally recognized futures index.[4]

The Nikkei average has deviated sharply from the textbook model of stock averages which grow at a steady exponential rate. The average hit its all-time high on December 29, 1989, during the peak of the Japanese asset price bubble, when it reached an intra-day high of 38,957.44 before closing at 38,915.87, having grown sixfold during the decade. Subsequently, it lost nearly all these gains, closing at 7,054.98 on March 10, 2009—81.9% below its peak twenty years earlier.

Another major index for the Tokyo Stock Exchange is the Topix.

On March 15, 2011, the second working day after the massive earthquake in the northeast part of Japan, the index dropped over 10% to finish at 8605.15, a loss of 1,015 points. The index continued to drop throughout 2011, eventually bottoming out at 8160.01 on November 25, putting it at its lowest close since March 10, 2009. The Nikkei fell over 17% in 2011, finishing the year at 8455.35, its lowest year-end closing value in nearly thirty years, when the index finished at 8016.70 in 1982.[5]

The Nikkei started 2013 near 10,600, hitting a peak of 15,942 in May. However, shortly afterward, it plunged by almost 10% before rebounding, making it the most volatile stock market index among the developed markets. By 2015, it has reached over 20,000 mark; marking a gain of over 10,000 in 2 years making it one of the fastest growing stock market indexes in the world.

Weighting

The index is a price-weighted index. As of late 2014, the company with the largest influence on the index is Fast Retailing.

Annual returns

Annual returns
Year Returns
1997 -21.19%
1998 -9.29%
1999 +36.79%
2000 -27.19%
2001 -23.52%
2002 -18.63%
2003 +24.45%
2004 +7.61%
2005 +40.24%
2006 +6.92%
2007 -11.13%
2008 -42.12%
2009 +19.04%
2010 -3.01%
2011 -17.34%
2012 +22.94%
2013 +56.72%
2014 +7.12%[6]
2015 +9.07%

Components

As of December 2015, the Nikkei 225 consists of the following companies: (Japanese securities identification code in parentheses)

Foods

Textiles & apparel

Pulp & paper

Chemicals

Pharmaceuticals

Oil & coal products

Rubber products

Glass & ceramics

Steel products

Nonferrous metals

Machinery

Electric machinery

Shipbuilding

Automotive

Precision instruments

Other manufacturing

Fishery

Mining

Construction

Trading companies

Retail

Banking

Securities

Insurance

Other financial services

Real estate

Railway/bus

Other land transport

Marine transport

Air transport

Warehousing

Communications

Electric power

Gas

Services

See also

References

  1. ↑ "the Nikkei (index) definition, meaning - what is the Nikkei (index) in the British English Dictionary & Thesaurus - Cambridge Dictionaries Online". cambridge.org.
  2. ↑ "Yahoo". Yahoo.
  3. ↑ Nikkei Definition via Wikinvest
  4. ↑ Nikkei Net Interactive
  5. ↑ "Finfacts: Irish business, finance news on economics". finfacts.com.
  6. ↑ http://indexes.nikkei.co.jp/en/nkave/archives/data

External links

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