Please turn in this page. Name____________________________________________________
The purpose of this assignment is to provide the student with an understanding of the basic market indexes and to provide an opportunity for predicting the level of The Dow Jones Industrial Average (DJIA). The student will also become familiar with the various indexes reported by The Wall Street Journal.
Answer the following questions where indicated and conclude by predicting what the level of the DJIA will be at the close of trading on Tuesday, May 9, 2000..
1. Fill in the following blanks.
Date of WSJ Using _______________
Fill in 4 blanks as follows::
(1) Current Index Value (2) 12 Month High
(3) 12 Month Low (4) Percent Change from 12/31/99
a. _________ _________ _________ ________ Dow Jones Industrial Average (30 equities)
b. _________ _________ _________ ________ S&P 500 (500 stocks)
c. _________ _________ _________ ________ NASDAQ Composite Index (5,354 stocks)
d. _________ _________ _________ ________ DJ World Index (ex U.S.)
e. _________ _________ _________ ________ London (FT-100) (100 stocks)
f. _________ _________ _________ ________ Nikkei 225 Index (225 stocks)
g. _________ _________ _________ ________ NYSE Composite Index (3,104stocks)
h. _________ _________ _________ ________ S&P 400 MidCap 400 stocks
i. _________ _________ _________ ________ AMEX Index (787 stocks)
j. _________ _________ _________ ________ Value Line Average (geom.) 1,695 stock
k. _________ _________ _________ ________ Russell 2000 (2000 stocks)
l. __________ _________ _________ __________ in $ DJ Europe/Africa (ex South Africa)
m. ___________ _________ _________ ________ in $ DJ World [2200 securities]
n. ___________ _________ _________ ________ YTD %CHG Lehman Brother Long T-Bond
2. _______________________________ is the name of the most comprehensive U.S. market index (NOT listed above) that includes firms trading on the NYSE and AMEX plus actively traded OTCstocks?
3. The weighting of companies in the Standard and Poor's indexes is by ________________ while weighting by companies in the DJIA is by ________________.
4. What is the weighting scheme used to calculate the Value Line Composite Average?______________________
5. Is it possible to have a trading day where the Value Line Composite Average has increased and the DJIA has declined?
______ If yes, why can this occur? If no, why can this not occur? (Please respond on back.)
6. ___________ Miscosoft's weight in the NASDAQ-100 (QQQ). You can obtain this from http://www.nasdaq.com.
7.a. _________________ What is your prediction of the DJIA for May 9, 2000?
7.b. _________________ What is your prediction of the 30-year Treasury Bond yield for May 9, 2000?
8. Cite and briefly summarize (one paragraph) an article from the current financial press that supports your predictions.
Provide citation for the article.