Difference in Weights of the Price and Weighted Kuwait SE Indices « Alpha Dinar- talking GCC finance

We have talked about the Price Index and the Weighted Index of the Kuwait Stock Exchange many times. The difference between these two is that one (Price Index) takes into account the price of the stock to determine the weight of the stock on the index, and the other (Weighted) take into account the market value of the company. We have said that we always prefer the Weighted index as it is a better indicator of the market, since it gives bigger companies more share within the index. Most of the indices around the world are weighted indicies.

The graph above shows the weights of the different companies listed on the Kuwait Stock Exchange and their weights within the two indices and the difference in weights. (Click on the graph for a better view)