Index investment is a must-see! What is the difference between the Nikkei Stock Average and the TSE Stock Price Index (TOPIX)?
Risk hedging is an important factor in index investing, and it is a good idea to invest according to market averages as much as possible.
The more stocks handled in the market, the more it is possible to diversify the effects of rising or falling prices per stock, and risk can be minimized.
When these are taken into account, the Nikkei Average $Nikkei 225(.N225.JP$ and topix $TOPIX(.TOPIX.JP$ If you think about which one is better, TOPIX is in favor of it.
The Nikkei Average carefully selected 225 stocks with high transaction liquidity and stability from approximately 2000 stocks listed on the Prime Market by Nikkei Inc., and is sometimes called the Nikkei Average 225.
Topix, on the other hand, covers all of the approximately 2000 stocks listed on the First Section of the Tokyo Stock Exchange, and has high real-time calculation and publication every second.
If you invest in all stocks for risk hedging, the Nikkei Average is 225 stocks by simple calculation, and TOPIX is about 2000, which increases the possibility that risk can be avoided by all means.
The more stocks handled in the market, the more it is possible to diversify the effects of rising or falling prices per stock, and risk can be minimized.
When these are taken into account, the Nikkei Average $Nikkei 225(.N225.JP$ and topix $TOPIX(.TOPIX.JP$ If you think about which one is better, TOPIX is in favor of it.
The Nikkei Average carefully selected 225 stocks with high transaction liquidity and stability from approximately 2000 stocks listed on the Prime Market by Nikkei Inc., and is sometimes called the Nikkei Average 225.
Topix, on the other hand, covers all of the approximately 2000 stocks listed on the First Section of the Tokyo Stock Exchange, and has high real-time calculation and publication every second.
If you invest in all stocks for risk hedging, the Nikkei Average is 225 stocks by simple calculation, and TOPIX is about 2000, which increases the possibility that risk can be avoided by all means.
In fact, in the example of market-linked funds, net assets are 19124 million yen on the Nikkei average, while TOPIX has more than doubled to 43836 million yen, and its high popularity can also be seen from this figure.
In terms of risk diversification, there are many people who choose Topix, which has many stocks, but on the other hand, there are also people who think that 225 stocks carefully selected by the Nikkei Average are stable.
If you are unsure whether to use the Nikkei Average or Topix, it is recommended that you consider it according to your respective budget and investment style.
The Nikkei Average and Topix are both used as investment indicators, but there are actually a number of differences. The Nikkei Average is an index of stock prices consisting of 225 highly influential stocks among companies listed on the first section of the Tokyo Stock Exchange.
This index was developed by an American company, and was announced in 1985 in the form of a purchase by Nikkei Inc. In other words, only Nikkei can announce the Nikkei Average.
The Nikkei Average is calculated by adding up the stock prices of 225 stocks and dividing them by a divisor.
Incidentally, there is no division by the number 225 of the number of stocks.
The reason is that there is a regular replacement once every year, and if 225 is used as the divisor number, the average stock price will go wrong when looking at the Nikkei Average over the long term.
Meanwhile, TOPIX is an index of stock prices published by the Tokyo Stock Exchange, also known as the TSE stock price index. TOPIX targets almost all stocks listed on the First Section of the Tokyo Stock Exchange, and the total market value for the index at the time of calculation is divided by the base market capitalization and multiplied by 100 is TOPIX.
Comparing each, it can be said that the Nikkei Average is easily influenced by 225 stocks, and there is a trend where it is easy to be pulled by stocks with high stock prices.
Since the influence of stocks with high market capitalization is greatly reflected in TOPIX, this point is a major difference between the two indicators.
People who are investing are worried about which one they should refer to, but since the characteristics are different, it seems better to use both the Nikkei Average and Topix.
In terms of risk diversification, there are many people who choose Topix, which has many stocks, but on the other hand, there are also people who think that 225 stocks carefully selected by the Nikkei Average are stable.
If you are unsure whether to use the Nikkei Average or Topix, it is recommended that you consider it according to your respective budget and investment style.
The Nikkei Average and Topix are both used as investment indicators, but there are actually a number of differences. The Nikkei Average is an index of stock prices consisting of 225 highly influential stocks among companies listed on the first section of the Tokyo Stock Exchange.
This index was developed by an American company, and was announced in 1985 in the form of a purchase by Nikkei Inc. In other words, only Nikkei can announce the Nikkei Average.
The Nikkei Average is calculated by adding up the stock prices of 225 stocks and dividing them by a divisor.
Incidentally, there is no division by the number 225 of the number of stocks.
The reason is that there is a regular replacement once every year, and if 225 is used as the divisor number, the average stock price will go wrong when looking at the Nikkei Average over the long term.
Meanwhile, TOPIX is an index of stock prices published by the Tokyo Stock Exchange, also known as the TSE stock price index. TOPIX targets almost all stocks listed on the First Section of the Tokyo Stock Exchange, and the total market value for the index at the time of calculation is divided by the base market capitalization and multiplied by 100 is TOPIX.
Comparing each, it can be said that the Nikkei Average is easily influenced by 225 stocks, and there is a trend where it is easy to be pulled by stocks with high stock prices.
Since the influence of stocks with high market capitalization is greatly reflected in TOPIX, this point is a major difference between the two indicators.
People who are investing are worried about which one they should refer to, but since the characteristics are different, it seems better to use both the Nikkei Average and Topix.
Both the Nikkei Stock Average and the Tokyo Stock Price Index (TOPIX) temporarily returned to the high levels of 31 years ago, but what is the difference between these two in the first place? TOPIX is a market capitalization weighted average index made by adjusting the stock prices of 2,187 stocks on the First Section of the Tokyo Stock Exchange by adjusting for floating stocks such as holdings.
It's the industrial structure of Japanese stocks itself, isn't it? Meanwhile, 225 stocks representing the Japanese stock market have been selected for the Nikkei Stock Average. The Nikkei Stock Average does not take market capitalization into account, but the number of stocks is allocated by selecting stocks in the regular review in October every year so that the industrial structure is similar. Nevertheless, the Nikkei Stock Average has its own peculiarities.
Simply put, the impact of the banking and automobile sector on indices is small, and the retail/electronics sector is large. This depends on the fact that the main stocks in the retail and electronics sectors are “high-value stocks.” For example, if the stock price of 10,000 yen moves 10%, there is an effect of “1000 yen ÷ 225 yen,” but even if a 1000 yen stock moves 10%, it only has an effect of “100 yen ÷ 225 yen.”
In other words, in the case of the Nikkei Stock Average, even if it is composed of stocks representing Japan, the influence of rapid stock price fluctuations of stocks with specific values increases, and it tends to be an index that “represents growth stocks where most of the value is stock” rather than representing Japan. On the other hand, TOPIX is relatively susceptible to stock prices in the banking and automobile sectors compared to the Nikkei Stock Average.
Now, from fiscal 2022, the Tokyo Stock Exchange will reorganize the current divisions of section 1, section 2, etc. into 3 parts of prime standard growth. TOPIX will be weighted to further consider liquidity, but the stock lineup will not change much.
It's the industrial structure of Japanese stocks itself, isn't it? Meanwhile, 225 stocks representing the Japanese stock market have been selected for the Nikkei Stock Average. The Nikkei Stock Average does not take market capitalization into account, but the number of stocks is allocated by selecting stocks in the regular review in October every year so that the industrial structure is similar. Nevertheless, the Nikkei Stock Average has its own peculiarities.
Simply put, the impact of the banking and automobile sector on indices is small, and the retail/electronics sector is large. This depends on the fact that the main stocks in the retail and electronics sectors are “high-value stocks.” For example, if the stock price of 10,000 yen moves 10%, there is an effect of “1000 yen ÷ 225 yen,” but even if a 1000 yen stock moves 10%, it only has an effect of “100 yen ÷ 225 yen.”
In other words, in the case of the Nikkei Stock Average, even if it is composed of stocks representing Japan, the influence of rapid stock price fluctuations of stocks with specific values increases, and it tends to be an index that “represents growth stocks where most of the value is stock” rather than representing Japan. On the other hand, TOPIX is relatively susceptible to stock prices in the banking and automobile sectors compared to the Nikkei Stock Average.
Now, from fiscal 2022, the Tokyo Stock Exchange will reorganize the current divisions of section 1, section 2, etc. into 3 parts of prime standard growth. TOPIX will be weighted to further consider liquidity, but the stock lineup will not change much.
Artist: The trajectory of building wealth with stocks. (note)
Last updated: 2022/10/2 15:15
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