Create your own index

Discussion in 'Technical Analysis' started by maninjapan, Aug 4, 2009.

  1. I'm looking at creating a group of original market indices for my own analysis. The question I have is what would be the best way to calculate them. They need to not only be accurate in regards to current prices, but I also need to be confident that the historical prices are also accurate which makes me wary of using anything that calculates based on fundamental data as I dont think I have enough to produce a consistantly accurate index.
    Obviously I could just use a purely price based calculation but I was wondering if there are any other alternatives.... any ideas anyone?
  2. If your new "index" correlates too closely to generally accepted benchmark indices, then you're wasting your time trying to create a "Holy Grail" indicator. Stick with the S&P-500. :cool:
  3. Eight


    Wyckoff wrote a book a long time ago. He talked about how to formulate mini-indexes for your stock analysis, it's a great book all around.
  4. nazzdack, your definately right there. Although Im not interested in trying to reinvent the wheel, nor am I trying to create any holy Grail. Just trying to create some more specific industry based indices that track my interests a little more accurately than whats out there.

    I think that indices weighted by Market cap are the way to go, however I dont have the historical data to back it up an fundamental data calculations