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TOPIX (Tokyo Stock Price Index)

TOPIX (the Tokyo Stock Price Index) is a stock price index calculated using a market-cap-weighted method, based on domestic ordinary shares listed on the Tokyo Stock Exchange.

How It Is Calculated

TOPIX is a "market-cap-weighted" index, calculated as the rate of change from a base point in time in the combined market capitalization of the constituent stocks. As a result, the price movements of stocks with large market capitalizations tend to have a larger effect on the overall index.

Difference from the Nikkei Stock Average

TOPIX is calculated differently from the Nikkei Stock Average, which uses a price-weighted method. Both are leading indices showing overall market trends, but because of the difference in how they are constructed, their movements can sometimes diverge, so it can be useful to check both.

This article is provided for general informational purposes only and does not recommend or solicit the purchase or sale of any specific investment method or security. Final investment decisions are your own responsibility.

Frequently Asked Questions

What stocks make up TOPIX?
It is composed of domestic ordinary shares listed on the Tokyo Stock Exchange that meet certain criteria. Following the transition to the new market segments, a review of the constituent stocks is being carried out in stages.
Which should I look at, TOPIX or the Nikkei Stock Average?
Both are leading indices representing overall market trends, but because they are calculated differently, their movements can sometimes diverge. Checking both allows for a more multifaceted understanding of overall market conditions.

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