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)
“Have you not heard of that madman who lit a lantern in the bright morning hours, ran to the market place, and cried incessantly: “I seek God! I seek God!””
—Friedrich Nietzsche (1844–1900)
“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)