A stock index or stock market index is a method of measuring the value of a section of the stock market. It is computed from the prices of selected stocks (sometimes a weighted average). It is a tool used by investors and financial managers to describe the market, and to compare the return on specific investments.
An index is a mathematical construct, so it may not be invested in directly. But many mutual funds and exchange-traded funds attempt to "track" an index (see index fund), and those funds that do may not be judged against those that do.
Read more about Stock Market Index: Types of Indices, Index Versions, Weighting, Criticism of Capitalization-weighting, Indices and Passive Investment Management, Ethical Stock Market Indices, Innovations Awards To Stock Indices, Lists
Famous quotes containing the words stock, market and/or index:
“The freedom to make a fortune on the Stock Exchange has been made to sound more alluring than freedom of speech.”
—John Mortimer (b. 1923)
“The market came with the dawn of civilization and it is not an invention of capitalism.... If it leads to improving the well-being of the people there is no contradiction with socialism.”
—Mikhail Gorbachev (b. 1931)
“Exile as a mode of genius no longer exists; in place of Joyce we have the fragments of work appearing in Index on Censorship.”
—Nadine Gordimer (b. 1923)