Ranking Date

Percentage
Gain()
Closing
quotation
(yen)
Factors
1
Oct. 14,
2008
14.15 9447.57
The markets reacted Iavorably to an overnight
rally on Wall Street as well as a series oI
measures announced in rapid succession by the
Group oI Seven industrialized countries to cope
with a global Iinancial crisis.
2 Oct. 2, 1990 13.24 22898.41
The Ministry oI Finance worked out measures to
prop up stock prices aIter the market plunged in
the wake oI the collapse oI Japan's asset-inIlated
bubble economy.
3
Dec. 15,
1949
11.29 109.62
The Bank oI Japan and Iinancial circles
conIerred about low stock prices resulting Irom
concern about the government's tight money
policy. LiIe insurance companies and banks
hammered out measures to buy stocks.
4
Oct. 30,
2008
9.96 9,029.76
Stocks soared on the yen's depreciation and the
U.S. move to cut interest rates.
5
Oct. 21,
1987
9.30 23947.40
U.S. stock prices rallied Iollowing policy
coordination by Japan, the U.S. and Europe to
reverse the impact oI Black Monday, which
triggered stock market declines worldwide.
6
Nov. 17,
1997
7.96 16283.32
The Liberal Democratic Party considered
injecting public Iunds into banks in the wake oI
the Iailure oI Hokkaido Takushoku Bank.
7
Jan. 31,
1994
7.84 20229.12
Expectations grew Ior an economic stimulus
package Iollowing the enactment oI political
reIorm legislation.
8
Oct. 29,
2008
7.74 8,211.90
Stocks surged on the yen's sharp drop against the
dollar and an overnight rally on Wall Street.
9
April 10,
1992
7.55 17850.66
Misgivings about simultaneous drops in stock
prices worldwide receded due to U.S. interest
rate cuts.
10
March 21,
2001
7.49 13103.94
Expectations mounted Ior banks to accelerate the
write-oII oI bad loans Iollowing a quantitative
monetary easing by the BOJ, while the U.S. also
lowered interest rates.

Ranking Date
Percentage
Gain()
Closing
quotation
(yen)
Factors
1
Oct. 20,
1987
- 14.90 21,910.08
The market plunged Iollowing the U.S. crash on
Black Monday.
2
Oct. 16,
2008
- 11.41 8,458.45
The overnight plunge on Wall Street and a sharp
strengthening oI the yen caused Tokyo shares to
tumble.
3
March 15,
2011
- 10.55 8,605.15
Following the devastating earthquake that struck
northeastern Japan and a series oI explosions at
the Fukushima Daiichi nuclear power plant, it
was reported that radiation was escaping Irom
the Iacility, which is operated by Tokyo Electric
Power Co.
4
March 5,
1953
- 10.00 340.41
The news oI the death oI Soviet leader Joseph
Stalin created speculation that the Korean War
could end, which would reduce demand Ior
Japanese goods.
5
Oct. 10,
2008
- 9.62 8,276.43
The benchmark index plummeted as market
sentiment soured Iollowing an overnight slump
on Wall Street and the dollar's plunge against the
yen.
6
Oct. 24,
2008
- 9.60 7,649.08
The key index Iell sharply on growing concern
over worsening earnings outlooks by export-
oriented companies amid the yen's sharp
appreciation.
7 Oct. 8, 2008 - 9.38 9,203.32
The market's tumble Iollows a sharp overnight
drop on Wall Street triggered by the worsening
oI the Iinancial turmoil over the subprime
mortgage crisis in the U.S.
8
April 30,
1970
- 8.69 2,114.32
The market Iell aIter European and U.S. stocks
declined on Iears about the health oI big
institutional investors.
9
Aug. 16,
1971
- 7.68 2,530.48
U.S. President Richard Nixon announced the
suspension oI dollar convertibility to gold.
10
April 17,
2000
- 6.98 19,008.64
A sharp Iall in New York stocks over the
weekend caused massive selling.

chorocteristics of the Nikkei 5tock 4veroqe

I
kkei SChtock Average
The Nikkei Stock Average is Japan's most widely watched index of stock market activity and has been calculated
continuously since September 7, 1950. (Before that date, the Tokyo Stock Exchange calculated the Tokyo Stock
Exchange Adjusted Average Stock Price, so index-based measurement of the market actually goes back to May 16,
1949.)


The current calculation method, called the Dow Jones method, has been used since 1950. The 225 components of
the Nikkei Stock Average are among the most actively traded issues on the first section of the TSE. The index
reflects the ex-rights-adjusted average stock price.


Since the Nikkei Stock Average is expected to represent the performance of stocks on the first section -- and by
extension the market in general -- the mix of components has been rebalanced from time to time to assure that all
issues in the index are both highly liquid and representative of Japan's industrial structure.


The previous round of rule changes governing deletion and addition of components took place in October 1991. The
revisions mandated replacement of issues whose trading volume had declined considerably with highly liquid
alternatives, all with an eye to maintaining balanced representation by the various industrial sectors. Japan's
economic and industrial environment has changed rapidly over the past 10 years and activity in the stock market has
reflected this.


n recent years, the pace of change has accelerated. Notably, an entirely new industry has emerged around
information technology (T). During this period of change, Japan has been suffering through a protracted recession
characterized by sluggish capital investment and weak consumer spending.


These circumstances have resulted in a situation where lines are being clearly drawn between winners and losers,
and these corporate strength differentials are driving a wave of mergers and acquisitions. A state of bi-polarization
has thus come to shape the stock market.


n response to these changes, Nikkei in October 1993 introduced the Nikkei 300 (Nikkei Stock Average of 300
Selected ssues), a weighted average based on market capitalizations of 300 component stocks. This was followed in
June 1998 by the launch of Nikkei Style ndexes (Value and Growth), which was created to recognize diversification
in asset management styles.


The debut of new indices illustrates Nikkei's recognition of the need to measure stock market performance from a
variety of perspectives. At the same time, however, we constantly assess our benchmark Nikkei Stock Average to
assure that it accurately reflects changes in industry and market structures.


The Nikkei Stock Average has now come to play a much larger role than simply measuring the market level and
reflecting trends. Use of the average as a base for futures and other index-linked derivatives, for example, is just one
of a growing range of applications.


t was these changes in the industrial and investment environments that necessitated revisions to the rules covering
selection (addition and deletion) of index components. The goal was to assure continuity of the basic philosophy of
using "225 Selected ssues" to accurately represent Japan's economic conditions.


n modifying the selection rules, Nikkei used input from the ndex Committee, a closed group of academics and
professionals formed to review the index. Revisions to the selection criteria led Nikkei to replace a relatively large
number of issues in an effort to make sure the Nikkei average accurately reflected structural changes in industry and
the stock market. Adherence to the principals governing calculation of the index ensures historical continuity -- one of
the most important characteristics of the Nikkei Stock Average.
Nikkei lndices chrono/oqy
ikkei Indices ChronoIogy
September 7, 1950: Tokyo Stock Exchange starts calculating a stock price average by the ex-right adjustment
method based on the Dow Jones model. The index is calculated retroactive to May 16, 1949.


November 12, 1968: TSE Chairman Morinaga announces the discontinuation of the TSE Adjusted Stock Price
Average and the introduction of a new stock market index.


July 1, 1969: TSE starts announcing the market value-weighted Tokyo Stock ndex. TSE continues to calculate and
announce the Adjusted Stock Price Average for just one year thereafter, limiting it to only daily closing prices.


July 1, 1970: Upon discontinuation of TSE Adjusted Stock Price, Nikkei nc., commissions calculations for a stock
index.


July 1, 1971: A Nikkei subsidiary, Nihon Short-wave Broadcasting Co., Ltd., starts calculating and announcing the
Adjusted Stock Price as NSB 225 Adjusted Average.


May 1, 1975: U.S.-based Dow Jones & Co. grants Nikkei exclusive rights to use of the name and the Dow calculation
method for the Nikkei Dow-Jones Stock Price Average.


January 4, 1982: Nikkei starts calculating and announcing the Nikkei Dow-Jones 500 Stock Average, which covers an
adjusted average for the selected stocks as of January 4, 1972.


April 1, 1985: Nikkei starts calculating and announcing the Nikkei Over-the-Counter Stock Average.


May 1, 1985: n a name change agreed to by Nikkei and Dow Jones, the Nikkei Dow-Jones Stock Price Average
becomes the Nikkei Stock Average. At the same time, the Nikkei Dow-Jones 500 Stock Average becomes the Nikkei
500 Stock Average.


September 3, 1986: Singapore nternational Monetary Exchange (SMEX) starts Nikkei Stock Average Futures
trading.


September 3, 1988: Osaka Securities Exchange starts Nikkei Stock Average Futures trading.


June 12, 1989: Osaka Securities Exchange starts Nikkei Stock Average options trading.


September 25, 1990: Chicago Mercantile Exchange (CME) starts Nikkei Stock Average Futures and Futures options
trading.


December 14, 1990: Nikkei announces new Deletion/Addition Standard, effective


October 1, 1991, for component stocks of the Nikkei Stock Average.


September 1, 1991: Nikkei starts calculating and announcing the market value-weighted Nikkei All Stock ndex for all
stocks listed on Japan's eight stock exchanges. t is calculated retroactive to January 4, 1980, and a value of 100 is
assigned to the index for that date.


October 1, 1991: First changes are made in Nikkei Stock Average under new Deletion/Addition Standard.


October 8, 1993: Nikkei starts calculating and announcing the market value-weighted Nikkei Stock Average 300 for
300 stocks selected from the TSE first section. The average is calculated retroactive to October 1, 1982, and a value
of 100 is assigned to the index for that date.


February 14, 1994: Osaka Securities Exchange starts Nikkei 300 Futures and options trading.


July 29, 1994: Chicago Board Options Exchange (CBOE) starts Nikkei 300 Options trading.


February 3, 1995: SMEX starts Nikkei 300 Futures and Future options trading.
co/cu/otion method
CaIcuIation method
The Nikkei Stock Average is the average price of 225 stocks traded on the first section of the Tokyo Stock Exchange,
but it is different from a simple average in that the divisor is adjusted to maintain continuity and reduce the effect of
external factors not directly related to the market.
6uation
Nikkei Average
Sum oI stock prices oI 225 constitutents

Divisor

a) Stocks that do not have a par value oI 50 yen are converted to 50 yen par value.
b) Numbers are rounded to two digits aIter the decimal point, or hundredths, to calculate the average.
c) Priority in the usage oI prices are:
1. Current special quotation (closing special quotation).
2. Current price (closing price).
3. Standard price, which is defined as follows:


The theoretical price of ex-rights, a special quotation from the previous day or the closing price from the previous day,
in this order of priority.

Adjustment of divisors
hen components change or when they are affected by changes outside of the market, the divisor is adjusted to
keep the index level consistent
.
1) In the case of ex-rights
New Divisor
Old Divisor X(sum oI stock prices cum rights - sum oI rights prices)

sum oI stock prices cum rights
Rights prices last cum stock price - theoretical value oI ex-rights

Theoretical
value oI
ex-rights

last cum stock pricepaid-in amount X paid-in
allotment ratio

paid-in allotment ratio split allotment ratio
hen there is no split or a reverse split, the split-allotment ratio shall be one.
) In case of capitaI decrease
Theoretical value oI ex-rights
last cum stock price

1-ratio oI capital decrease
3) In the case of repIacement of components in the average
Rights price = price of replaced components - price of added components
) In the case of stock buyback by issuer
Divisor not adjusted
Magnifications
Adjusted magniIication
225

divisor

Adjusted magniIication
Adjusted average

sum oI stock prices
/
sum oI stock prices

225

mathematical average divisor 225 divisor
The %okyo Stock xchange ( Tky Shken Torihikijyo

),
called %sh (

) or %S for short, is located in Tokyo, Japan and is the third largest stock
exchange in the world by aggregate market capitalization of its listed companies. The Tokyo Stock
Exchange had 2,292 listed companies with a combined market capitalization of US$3.8 trillion as of Dec
2010.
[1]

hat Does Moving Average Convergence Divergence - MACD Mean

A trend-following momentum indicator that shows the relationship between two moving averages of
prices. The MACD is calculated by subtracting the 26-day exponential moving average (EMA) from the
12-day EMA. A nine-day EMA of the MACD, called the "signal line", is then plotted on top of the MACD,
functioning as a trigger for buy and sell signals.

hat Does 5onential Moving Average - MA Mean

A type of moving average that is similar to a simple moving average, except that more weight is given to
the latest data. The exponential moving average is also known as "exponentially weighted moving
average"