The question of how much wealth is needed to live on can be broken down into two factors, which are very individual for each person, and a basic formula in which the two factors are used. The basic assumption in each case is that the assets should not be depleted, but that the income from the assets should cover the required amount.
In this article, I introduce you to the calculation procedures for capital-weighted stock market indices. As an example, Deutsche Börse’s leading index is the Deutsche Aktien Index (DAX®). The intended audience of the article are all readers who are interested in stock market and finance issues and who want to understand the basis on which the charts are created, which today can be consumed at any time via television, stock market magazines or the Internet.