Motivation

Financial indices are commonly used as benchmarks to compare the relative performance of portfolios or other collections of instruments. Indices can be standardised (for example, the FTSE series of indices) but analysts may also want to base their research on custom indices. Index Builder is a demonstration of an application that supports the creation of such indices.

The application is implemented in HTML and JavaScript to provide a small download footprint and seamless integration with other web content. Charting functionality is provided using a high-performance Flex component based on a charting library developed by Scott Logic.

The live application is available here.

Overview

Index Builder is a web application that allows users to create and store custom indices based on UK equity data.

Indices can be created from scratch by selecting the desired individual stocks or sectors, or using the constituents of one of the primary FTSE indices as a starting point. Individual stocks can be located by browsing through sectors, or through full text search. The tri-state sector checkboxes against allow for the quick addition or removal of entire sectors, and also indicate partial selection of a sector, thereby providing a rough overview of an index’s sector distribution.

The custom indices are calculated from the constituent prices using weightings proportional to the market capitalisation of each constituent. This is the same methodology as used by many major index providers, including FTSE. The time series for an index can rapidly be recalculated as constituents are added or removed.

The performance of custom indices can be compared to one another, any of the primary FTSE indices or any individual stock using the interactive chart, which uses a Flex charting library developed by Scott Logic. When multiple time series are plotted, they are automatically rebased to show the percentage change for each over the selected time frame, in order to support more meaningful comparison.

The live application is available here.