Name : Fasha amalia wulandari

NIM :B1034181023

Please answer the following questions !

1. What is composite index ? What is the function of composite index?

2. How many composite index we have in BEI? What is the difference between those
indexes?
3. Mention the composite indexes for several stock market in the world !
4. How to calculate the composite index?
5. What factors that can influence the composite index? Explain iti.

ANSWER :

1. A composite index is a collection of a great many equities, other securities, or other

indexes that are averaged together to represent overall market or sector performance.
Typically, the elements of a composite index are combined in a standardized way to
present large amounts of data easily. Indexes are statistical tools, which can provide a
useful measure of securities' relative performance over time. Composite indexes are
created to conduct investment analysis, measure economic trends, and forecast market
activity. They are used as tools for tracking securities' price changes relative to an entire
stock market or sector. Therefore, they provide a useful benchmark against which to
measure an investor's portfolio. The goal of a well-diversified portfolio is usually to
outperform the main composite indexes. Three of the most-followed indexes in the
United States are the Nasdaq Composite, Dow Jones Industrial Average (DJIA, the
Dow), and the Standard & Poor's 500 Index (S&P 500).
2. First is Indeks Harga Saham Gabungan (IHSG), An index that measures the stock price
performance of all listed companies in Main Board and Development Board of the
Indonesia Stock Exchange. and other composite indexes include in IHSG are:
a) Indeks Sektoral
b) Indeks LQ45
c) Jakarta Islamic Index (JII)
d) Indeks Kompas-100
e) Indeks Bisnis-27
f) Indeks Pefindo-25
g) Indeks Sri-Kehati
h) Indeks Papan Utama
i) Indeks Papan Pengembangan
j) Indeks Individual
 The difference between those indexes are only in the measurement of stock price
performance. Each index has an amount limit in measuring the performance of stock
prices.

3. Those are:
 IHSG
 The Dow Jones Industrial
 Aver-age Index
 Nikkei 225 index
 Shanghai Composite Index
 FTSE100 index
4. Formula :
∑qn
Quality = ------------ X 100
∑q0

∑pn
Price = --------------- X 100
∑p0

Example:

Price Quantity
2016 2017 2018 2016 2017 2018
Pie 5.2 5.0 6.3 400 500 900
Cake 6.3 3.0 5.7 900 800 700

Question:
 Composite price index for 2016 with 2017 as base year!
= 11,5/8 x 100 = 143.75
 Composite quality index for 2016 with 2018 as base year!
= 1300/1600 x 100 = 81.25
5. Each stock market influences the index in proportion to its price per share. A stock with a
higher price will be given more weight than a stock with a lower price, and therefore will
have a greater say in the index’s performance. The composite level would be found by
adding the components, then dividing that sum by the number of components.