Investment Jargon: Index


An index combines the prices of many assets in a market to produce a single number summarising that market’s performance.​ For example the S&P 500 stock index measures the prices of 500 of the largest US companies and provides a general reading on the performance of US stocks. News media often report the prices of stock indices as a sort of shorthand for how markets are performing. It is now possible to buy a whole market with very low fees though passive exchange-traded funds.