The Nikkei Index 225, also known as the Nikkei Average Index, with the English name “Nikkei 225”, is a very important stock price index in Japan. It is listed as Japan’s two most-watched stock indexes alongside another Japanese stock price index: the Topix Stock Index The stock price index. The Nikkei Index 225 was founded in 1950 by the Nikkei News Agency and covers 225 companies with the most representative and most liquid stocks in the six major sectors of Japan’s technology, finance, consumer products, materials, capital goods, transportation, and infrastructure, A total of 225 constituent stocks.

Unlike most mainstream stock prices, the Nikkei 225 is a price-weighted index (the Dow Jones Industrial Index in the United States is also a price-weighted index). Therefore, the higher the company’s stock price, the greater the impact on the stock index. As of December 2019, Fast Retailing (Fast Retailing) is the most influential company, but it is the 11th largest by market capitalization. As the management agency of the stock price index, the Nihon Keizai Shimbun will review the index every October. Substandard constituent stocks will be removed and non-constituent stocks that meet the criteria will be included.

It is worth noting that the Nikkei Index 225 only includes companies that have been listed on the Tokyo Stock Exchange, so it does not include companies that were previously listed on the Osaka Stock Exchange (the stock division has now been merged into the Tokyo Stock Exchange) such as Nintendo.

During Japan’s bubble economy, the Nikkei 225 had more than six times in 10 years, and once rose to its historical high of 38,957.44 points (December 29, 1989), but in the following 30 years, the index has not broken this record again.

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