Preparing Reports & Returns Simulation

Preparing Reports & Returns Simulation

When looking at indices, you will have two index numbers. One for the year you are working with and one for the base year. Depending on whether you are indexing forward in time or indexing back to a past period the figure for the year you are working with will get bigger or smaller......that is generally assuming that prices are rising.<BR><BR>So if you were indexing from, say, 2000 to 2004, you would expect your figure to get bigger because prices have risen between 2000 and 2004. In this case you will be putting the 2004 index on the top and the 2000 index on the bottom and using this as the multiplier for your "figure".<BR><BR>If, on the other hand, you were taking your figure from 2003 back to 1999 base then you would expect prices to be less in 1999. So, you would put the 1999 index on the top and the 2003 index on the bottom and use that as your multiplier.