New Stock Market Index (SEI)

Quibit · 1 New Stock Market Index (SEI) Sun Apr 22, 2012 11:37 pm

Quibit

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I think it's time that the forum formulate a new index to determine the movement of the stock market. We are sick of MILANKA and ASI.. Are'nt we??? Please feel free to contribute your ideas. We can call this index as 'SriLanka Equity Index' (SEI).

Please suggest the way we should formulate and calculate it.

UKboy · 2 Re: New Stock Market Index (SEI) Mon Apr 23, 2012 3:03 am

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Orbit wrote:I think it's time that the forum formulate a new index to determine the movement of the stock market. We are sick of MILANKA and ASI.. Are'nt we??? Please feel free to contribute your ideas. We can call this index as 'SriLanka Equity Index' (SEI).

Please suggest the way we should formulate and calculate it.

Should not allow illiquid high caps to change the index so drastically (not like now). Ex: CARS, GREG, CTC, NEST, BUKI, SLTL etc.

troy · 3 Re: New Stock Market Index (SEI) Mon Apr 23, 2012 8:31 am

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UKboy wrote:

Orbit wrote:I think it's time that the forum formulate a new index to determine the movement of the stock market. We are sick of MILANKA and ASI.. Are'nt we??? Please feel free to contribute your ideas. We can call this index as 'SriLanka Equity Index' (SEI).

Please suggest the way we should formulate and calculate it.

Should not allow illiquid high caps to change the index so drastically (not like now). Ex: CARS, GREG, CTC, NEST, BUKI, SLTL etc.

Is GREG illiquid??? I ddnt Know that...

Anyways this will be a timely move. However the formula must be simple and understandable.

mark · 4 Re: New Stock Market Index (SEI) Tue Apr 24, 2012 11:18 pm

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good idea,
odd trades should be ignored when calculating closing prices Evil or Very Mad

remove loss making high illiquid companies Smile

add
CTC
CINS
NEST
LLUB
Very Happy

K.Haputantri · 5 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 8:05 am

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Orbit wrote:I think it's time that the forum formulate a new index to determine the movement of the stock market. We are sick of MILANKA and ASI.. Are'nt we??? Please feel free to contribute your ideas. We can call this index as 'SriLanka Equity Index' (SEI).

Please suggest the way we should formulate and calculate it.

A timely move. As SEI should be a representative index of all types of shares of the bourse, a certain % of all types of shares need to be identified not allowing one type to dominate the index. Else sectoral SEI's can be worked out in addition. Leaving out illiquid shares & odd lots would be good. The list can be revised periodically. When illiquids become liquids they can be accomodated in revisions. The fixed period of revisions may be amended under special circumstances such as when an illiquid suddenly hits the bourse with a huge transaction.

aj · 6 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 8:28 am

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Great idea. Make sure the illiquid shares like CARS, BUKI, NEST, CTC, SLTL go up in 50/- by buying 1000 the index should have microscopic effect. That is percentage of the shares transacted for the day (less shares transacted less effect).
For example if there are Rs. 100,000,000,000 worth of shares and Rs. 100 worth shares transacted for the day then the contribution should be only 100 / 100,000,000,000 billion to the index. That meas index goes up by 0.000000001 Very Happy

Quibit · 7 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 8:52 am

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Suggestion for proposed new index.

Base index is 5000

Daily index calculation:
No of shares that had positive price gaines during the day= 55
No of shares that negative price gain during the day = 25

Index
5000+ 55-25 = 5030

Please comment!!!

aj · 8 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 9:36 am

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Orbit wrote:Suggestion for proposed new index.

Base index is 5000

Daily index calculation:
No of shares that had positive price gaines during the day= 55
No of shares that negative price gain during the day = 25

Index
5000+ 55-25 = 5030

Please comment!!!

That won't work. Usually what happens is that in the morning a few of those illiquid shares are made to go up to show the green. And then when you see the green people get fooled and start buying others so the "number" of shares that gained at the end of the day goes up.

What should happen is,
If there are Rs. 100,000,000,000 worth of shares and Rs. 100 worth shares transacted for the day then the contribution should be only 100 / 100,000,000,000 billion to the index. That means index contribution is 0.000000001 X (share price change percentage)
Calculate all those 0.000000001 X (share price change percentage) like values and Add up together to make the index value.
How about that?

Actually add this 0.000000001 to the existing all price index formula in each stock contribution.

In summary take the existing contribution value to the price index in the all share index (what is already calculated) and instead of adding it as it is, multiply it by this e.g. 0.000000001 calculated value.

Redbulls · 9 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 10:59 am

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Orbit wrote:Suggestion for proposed new index.

Base index is 5000

Daily index calculation:
No of shares that had positive price gaines during the day= 55
No of shares that negative price gain during the day = 25

Index
5000+ 55-25 = 5030

Please comment!!!

Totally idiotic idea.
From your point of view the new index will move between 5000 and 5278.
What we are going to achieve with that?

AJ's idea to certain extend applicable.

Quibit · 10 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 11:18 am

Quibit

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Redbulls wrote:

Totally idiotic idea.

From your point of view the new index will move between 5000 and 5278.
What we are going to achieve with that?

AJ's idea to certain extend applicable.

How can it will only move between 5000 and 5278.
Please read and understand before criticizing others. No idea is idiotic!! Idiots may not have ideas!!

rijayasooriya · 11 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 8:22 pm

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I think volume traded has to be considered or atleast minimum traded volume has to be there to make it eligible.

Quibit · 12 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 8:33 pm

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SEI should be a index that should be totally different from ASI and Milanka. That is the only way to make it known and popular. Therefore all of us need to think 'out of the box'

Good ideas are appreciated.

rijayasooriya · 13 Re: New Stock Market Index (SEI) Wed Apr 25, 2012 8:40 pm

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GMNet wrote:SEI should be a index that should be totally different from ASI and Milanka. That is the only way to make it known and popular. Therefore all of us need to think 'out of the box'

Good ideas are appreciated.

But it should not be "kabalen lipata watuna wage" (කබලෙන් ලිපට වැ‍ටුනා වගේ) Wink