The Big Picture
The market. When your friend asks, “How was the market today?” and you are in the U.S., your answer is something like, “The Dow was up 50.” In the UK, the FTSE (pronounced “footsie”) was up 50. In Japan, the Nikkei was up 50. Are they all talking about the same market? Well, no. Each is referring to a specific market index, and each index is taking only a small slice of the stock market in its respective country.
The Dow Jones Industrial Average has only 30 stocks, yet is one of the most widely used methods to describe the “market.” Staying with the U.S. market, the Standard and Poor’s 500 is broader in coverage, but there are several thousand stocks listed on the major stock exchanges and many thousands more traded over the ...
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