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Strategies & Market Trends : Jim's Nasdaq100 Special as a basket.
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To: stockycd who wrote (1437)10/26/1999 9:52:00 PM
From: James F. Hopkins  Read Replies (1) of 2103
 
RE > Could it really close at 10302 and open the next day at 10630? That would really mess the charts up. I know very little about this sort of thing.

No that would not happen..they would re-weight the exposure
like if it was to have happen tonight ..the amount of exposure
would go from 5.066985 shares per company to 4.910453 shares
per company and the index would stay the same.

It's the arbitragers who track the DOW who have the head problem
with figuring out where things are going to be at on the Friday
close so they know what to buy or sell <G>

It will open at the same price except that after hours trading
dumps or buys a stock , like if they all open at what they
closed at there will be no change in the index, that adjustment
is made via the amount of exposure to each based on the closing
prices Friday . There will likely be a knee jerk Monday as
every one calculates exactly what they need or don't need
to track her..some of that will be smoothed out via future
contracts.

Like some will go short futures, and latter buy the futures
back as they sell the stocks they don't need , others may buy
the futures and then latter buy the stocks they need when they
sell the futures. The Dow futures will likely be a lot more
wild than the stocks from now to Monday I'm glad I'm not
one who has to do any adjusting.

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