may prevail. But this viewpoint known as hard EMH also predicts that little or no tradingshould take place, contrary to fact, since prices are already at or near equilibrium, having priced in all public knowledge. The hard efficient-market hypothesis is sorely tested bysuch events as the stock market crash in 1987, when the Dow Jones index plummeted22.6 percent the largest-ever one-day fall in the United States.
Stock market indices are classified in many ways. A global stock market indexincludes typically large companies without regard for where they are traded. Theexamples are MSCI World and S&P Global 100.Each country or nation has its own stock market index representing its performance. The most commonly quoted market indices are national indices composedof the stocks of large companies listed on a nation's largest stock exchanges, such as theAmerican S&P 500, the Japanese Nikkei 225, and the Karachi KSE 100.The idea may be extended well beyond an exchange. The Dow Jones Total Stock Market Index represents the stocks of nearly every publicly traded company in the UnitedStates, including all U.S. stocks traded on the New York Stock Exchange (NYSE) andmostly traded on the NASDAQ and American Stock Exchange (AMEX). Morespecialized indices exist tracking the performance of specific sectors of the market.
The indexes, such as the S&P 500, have many versions. These versions can vary based on how the index components are weighted and on how dividends are accountedfor. For example, there are three (3) versions of the S&P 500 index: price return, whichonly considers the price of the components, total return, which accounts for dividendreinvestment, and net total return, which accounts for dividend reinvestment after thededuction of a withholding tax.
1.4 MOST POPULAR AND LARG
Today AMEX is one of the largest options exchanges in the United States.
NYSE is founded in 1792, the Big Board is the where the big companies haveshares. The NYSE is where companies such as Coca cola, McDonald's, General Electric