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Explain the problems that an investor may face if she relies on the following stock?


Explain the problems that an investor may face if she relies on the following stock
market indices: the Dow Jones index, the Nikkei 225 index.

the full question is

Explain the problems that an investor may face if she relies on the following stock
market indices: the Dow Jones index, the Nikkei 225 index.

This all the information that im given. Even if you don't know the answer, please give details on things i could discuss as its a 1-2 page essay question. If you know any good websites or places of information to answer it please don't hesitate to let me know. thanks

The extra information is very helpful and puts the question into context. You may want to contact a local brokerage firm and ask for a more detailed answer than I can give you.

The only problem I see with relying on indices is that no one index gives you a full picture of the stock market. For example, the Dow is a composite of (I think) 65 stocks. I don't know anythink about the Nikkei, except that it's the Japanese equivalent of the Dow.

Good luck!

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