How To Graph Performance Of Stock Against Index

Evaluating stock performance is something that is very individual to each investor. Just as every person has different appetites for risk, plans for and investing strategies, so too does every investor have different standards for evaluating stock performance. One investor may expect an average annual return of 10% or more, while another may look to add to his portfolio with a stock that is not correlated with the stock market as a whole. Whatever you look for in a stock’s performance, there are a few variables to consider to help you evaluate whether that stock is a good investment for you. A stock’s performance needs to be placed in context to understand it properly. On the surface, it looks great to see that a stock has returned 20% since the beginning of the year when viewing the starting price versus the ending price, but you need to look a little deeper. Was the stock abnormally depressed on the first day?

1. How To Graph Performance Of Stock Against Index Today
2. How To Graph Performance Of Stock Against Index Value

If so, it could throw the numbers off. To counter this, most investors look at the stock’s. Consider the actual performance of the stock over a period, as though you had invested in it on that first day of the period. Also, look at how the stock has done (YTD), as well as over the past 52 weeks.

Finally, consider the stock’s average annual return. Look at the five-year average annual return but also look at the 10-year average annual return if you are considering a longer-term investment. To evaluate a stock, review its performance. You may be satisfied with a stock that generated an 8% return over the past year, but what if the rest of the market is returning a few times that amount?

Take the time to compare the stock’s performance with different, such as the Dow Jones Industrial Average, the S&P 500 or the Small-Company Stock NASDAQ Composite Index. These indexes can act as a sort of benchmark. You may also want to look at how the economy has done during the same period, how inflation has risen and other broader economic considerations. Of course, even if a company has done well compared to the larger market, there is still the question of how its industry is doing. It could happen that a stock is outperforming the market but underperforming its industry, so make sure to consider the stock’s performance relative to its primary competitors as well as companies of similar size in its industry. For example, if you are evaluating a small semiconductor company, you cannot compare a startup business directly with a well-established company such as Intel, even if the two companies' products may compete against one another in some arenas. While it helps to see how that may be doing relative to its larger competitors, it gives you greater perspective to also consider competitors in similar stages of their business life cycles.

Step 4: Represent performance graphically. Highlight the Value of $1 columns for the stock and the comparative and then Insert Chart and create the chart. For the case of the DIS stock relative to the S&P 500, we see that the performance of both is very similar. Total Return Stock Performance Graph: Our standard five-year Stock Total Return Performance Graph includes your company's total returns, a broad market index, a peer group of your choice whether a custom group of companies, SIC Code Group, or industry index, and all underlying data, including price and dividends. Learn how to Import and quickly Chart historical stock prices in Microsoft Excel using data from Yahoo Finance. This is a great way to visualize the moves in a particular stock.

In addition to looking at a company’s total returns, comparing them to the market and weighing them relative to competitors within the company's industry, there are several other factors to consider in evaluating a stock’s performance. For one, you should look at whether the company pays dividends and how reinvesting those dividends may improve its total returns. Also, be sure to factor in inflation in calculating returns, especially as you consider long-time horizons for your investments.

This is called a and can be done simply by subtracting inflation from the annual return of your investment.

Creating an index and graph to compare Company Stock Performance with S&P500 BU113: Critical Thinking andCommunication in BusinessCreating an Index and graphto compare Company Stock Price Performancewith the market(S&P 500)I. Putting information for your stock and the S&P 500 from Yahoo!Financeinto Excel1. In Yahoo!Finance, get stock prices for ONE of yourcompanies for a 9-day period of time ( 3 days before the announcement/event, theday of the announcement/event, and 5 days afterthe announcement/event). To dothat, open Yahoo!Finance ,type the name of the company or the symbol in the Get Quotes window HistoricalPrices (left column, under Quotes) Setthe appropriate Date Range for your company's event or announcement click “ Get Prices,” then click ' Download to Spreadsheet'.This will open up an Excel spreadsheet.2.Save the new document/file as an Excel spreadsheet (.xlsx) to the z:drive. UseSAVE AS (on your z:drive or portable storage device) and name the file “ StockPerformance Index”.3. Insert3 rows above the information in the spreadsheet (Date, Open, Close, etc.): Putthe cursor into Row 1 right-click Insert. Do this 2 more times until youhave added 3 rows.4.

In cell A1, write CREATING AN INDEX FOR STOCK PERFORMANCECOMPARISONS. In cell A3, the title “’s (company name) Stock Prices (e.g.Motorola’s Stock Prices).5.Thevalues from Yahoo should now be in cell A4.6. Delete all columns except for the date column and the closing prices(highlight the cells to be deleted, right-click Delete and select Shift cellsleft).7. SAVE the file “Stock Performance Index”.Minimize the Excel file and maximize the Yahoo!Financefile.8.

Get the S&P 500 values for the same dates ( Yahoo!Finance Historical Prices Setthe same Date Range as you did above for your company's event or announcement click “GetPrices.” (Another way to get there is to use theLookup Symbol for S&P Index in Yahoo:^GSPC)and click Historical Prices in the left navigation bar. Then Setthe appropriate Date Range for your announcement click “GetPrices” and 'Download to Spreadsheet.' Copy the S&P 500 dates and prices (right-click Copy), open up your Excel spreadsheet, write the title “S&P 500Values” into cell E3.10. Copy and paste the S&P 500 values into your Excel spreadsheet, into cell E4.11. Important note: All dates need to be inascending order (from the oldest to newest).To do that, highlight the dates and prices, click DATA (top menu bar) SORT A-Z (ascending) order. All dates and prices will now be in the correctorder.II. Calculating the index values for your stock and the S&P values1.

In cell A15, write the title “Index Values for (companyname).2. In cell A16, write the title “DATE”, in cell B16 “PRICE”, and in cell C16“INDEX VALUE.”3. Copy and paste the first date (earliest) of your 9 dates and the stockprice for that date into cell A17. Copy the next date and price into A18, andso on, until you have all 9 dates and prices.4. Write 100 into cell C17.5. F orcalculating formulas or equations, Excel uses the = sign.

Formulas can beput into the cell itself using the = sign or into the f x window.In cell C18, write =. Then click cell B18 (the price on the secondday) and see how the program puts “B18” into the cell. Then write “/” (divide)and click cell B17 (the base price, or the price on the first day). See how theprogram puts “B17” into the cell.

How To Graph Performance Of Stock Against Index Today

Then write “.100” (multiply by 100). This isthe index value for Day 2, and you have used the formula for creating an index.The general index formula: Take the new value, divide it by the old/basevalue and multiply by 100.6. Instead of calculating each index value, you can use a shortcut (forthe operation in #5): Clickthe cell in which you want to calculate the index (C18); then click or type =.Click the cell with the new value (B18). Type “/” (divide) and click cell B17(the base value). Since each following value must be divided by the basevalue, you need to lock the basevalue. ( WARNING:Simply copying and pasting will yield incorrect results!) Tolock the value of a cell, place a dollar symbol before and after the cell (since the index or base value always remains the same),e.g.$B$17.100, and type.100. Now you have the formula.

Copy and pastethe formula into the remaining cells. To do this, click in cell C18. Thendo a right-click and select Copy.7.

Highlight all remaining 7 blank cells in the index column, do aright-click and select Paste Special Formulas. The program copies the formula for all remaining days. GREAT,ISN’T IT?8. Your values should only have 2 decimals (after the period). Tochange your values to this format, highlight the column that needs changing,right-click, and select Format Cells.

Click the Number tab andclick Number and OK (the default is 2 decimal places).9. In column E15, write “INDEX VALUES FOR S&P 500”.10. In columns E16, F16, and G16, write “DATE”, “VALUE”, and “INDEXVALUE”.11. Follow the same procedure as above to copy and paste the dates,values, and to calculate the index values.III. Creating a Performance Chart1.

In cells A27 and B27, write “DATE”, “ (company name) INDEX VALUES”,and 'S&P500 INDEX VALUES.3. Copy and paste the dates into cell A29.4.WARNING: To copy the index values for your company, highlight the values,click Copy, thenPaste Special Valuesinto cells B29-B37.5. Repeat Step 4 for the S&P 500 and put the values into cells C29-37.6. Highlight all the data for cells A27 to C37.7. Click on the Chart Wizard icon (function/icon toolbar atthe top) ( MS Excel 2007/2010: ClickInsert Line to insert a Line Chart). Your graph should appear on your spreadsheet or on a new sheet.8.

Select Line and a graph with markers for data points (left graphin row 2).Excel 2003Excel 2007/20109. In theData Range tab, select Columns.10. In the Series tab, click the first series, then Name andwrite “Index Values (company name)”.11.

Click the second series, then Name and write “Index Values S&P500). Click Next.12.

In the Titles tab, put the cursor into the Chart Titlewindow and write “Performance of ’s Stock vs. In the “Category (X) axis” window, write “Date”.14. In the “Value (Y) axis” window, write “Index Values”.15. Click Next and select “as object in sheet 1”.

Then clickFinish.16. Your graph should appear on your spreadsheet or on a new sheet.17. You can move the graph to the second page if you like.18. SAVE AS with the same file name as above.19.

Print the spreadsheet and the graph.See sampleindexes and graphs:.a sample stock price index and graph for(effect of the iPad announcement).a sample stock price index and graph for(effect of an announcementabout a drug)9.Select the graph by clicking inside it.10.Select Layout on the top menu bar.Add a Chart Title:“Performance of ’s Stock vs. S&P500”.11.Select Axis Titles and write 'Index Values' on the vertical axis and'Dates' on the horizontal axis.12. In the Titles tab, put the cursor into the Chart Titlewindow and write “Performance of ’s Stock vs.

How To Graph Performance Of Stock Against Index Value

You can move the graph to the second page if you like.14. SAVE AS with the same file name as above.15. Print the spreadsheet and the graph.See sampleindexes and graphs:.a sample stock price index and graph for(effect of President Obama'sannouncement).a sample stock price index and graph for(effect of the iPad announcement).a sample stock price index and graph for(effect of an announcementabout a drug)©2001.This page was last updated:February 27, 2012.