Investor Glossary-stock market indexInvestor Glossary-stock market indexInvestor Glossary-stock market indexInvestor Glossary-stock market indexInsightful stock market charts - Click here
investor
Categories    # 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

Stock Market Index

The HTML to link to this page
 

A stock market index is a hypothetical basket of securities designed to track market changes. The most widely followed US stock market indexes are the Dow Jones Industrial Average, the S&P 500, and the Nasdaq Composite. Important international stock market indexes are the Nikkei 225 (Japan), FTSE 100 (UK) and Hang Seng (Hong Kong). Many stock market indexes can be traded with ETFs, futures and options.

Each stock market index has its own methodology for calculating the effect of changes in individual index components. The Dow Jones, for example, is a price-weighted stock market index where a rise of $1 in the stock of a $300B company produces the same affect as a rise of $1 in the stock of a $30M company stock. Most stock market indexes use capitalization-weighted adjustments to account for the differences in company size.



Rate this stock market index definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: ex-dividend, deferred revenue, limit order, FTSE, stock split, APR, 401a, 144a, phantom income, debt service coverage, liquidity ratio, current ratio, diluted share, LIBOR, margin rate, minority interest, ex-dividend date, reverse mortgage, dividends payable, Zero Cost Collar, covered put, balance sheet, 1035 exchange, deferred tax, per diem, VIX, class C shares, wholly-owned subsidiary, required rate of return, EBITDA, real GDP, 1031 exchange, stock market close, in escrow, risk management, inflation, quality assurance, command economy, option premium, average price per share, Key Rate Duration, irrevocable trust, annual return, open position, cancelled check, retained earnings, FICO score, labor relations, implied volatility


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Investor Glossary | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2015 Investor Glossary - All rights reserved - Terms of Use