Investor Glossary-indexInsightful stock market charts - Click here

 # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z     
Email this Definition Link to this Definition AddThis Social Bookmark Button

Index


An index is a hypothetical basket of securities or economic variables designed to track changes over time. The most common type of index tends to be the stock index such as the Dow Jones Industrial Average and the S&P 500 Index. Each index has its own methodology for calculating the effect of individual index components. The Dow Jones, for example, treats its 30 stocks identically; a rise of $1 in the stock of a $300B company affects the index in exactly the same way as a rise of $1 in the stock of a $30M company stock. Other indexes make varying degrees of adjustments to account for the differences in company size. Indexes can track market characteristics instead of market values. For example, the Volatility Index (VIX) measures options premiums to determine the market's expectation for future volatility. There are also economic indices that track measures of economic health, such as the Consumer Price Index (CPI).


               


Where is the market headed? The answer may surprise you. Find out
right now with the exclusive & Barron's recommended charts of Chart of the Day.


 Popular Terms : deferred revenue, 401a, forward PE, minority interest, deferred tax, real GDP, retained earnings, 144a, average price per share, trailing PE, wholly-owned subsidiary, diluted share, FICO score, net book value, LIBOR, cancelled check, debt service coverage, 1031 exchange, inflation, liquidity ratio, EBITDA, arm's length transaction, per diem, option premium, command economy, commodity, COO, 1035 exchange, reverse mortgage, Zero Cost Collar, balance sheet, phantom income, margin rate, labor relations, net income, current ratio, assets under management, required rate of return, covered put, Key Rate Duration, class C shares, APR, quant, Russell 3000, stock, asset/equity ratio, CUSIP, Black Friday, annualize




 Rate the index definition... Receive our free Term of the Day email.
 Your Rating:
 Poor 1 2 3 4 5  Excellent
Simply type in your email address and click submit:
 Comment:   
 Please Enter The Code in the text box:
 


Subscribe   Unsubscribe
Home | Term of the Day | Tell a Friend | Suggest a Term | Edit Subscriber Detail
Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
©2004-2008 Investor Glossary - All rights reserved