Indices
Indexes are a group or basket of securities, derivatives, or other financial instruments that represents and measures the performance of a specific market, asset class, market sector, or investment strategy.
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Stock market indexes around the world are powerful indicators for global and country-specific economies. In the United States the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite are the three most broadly followed indexes by both the media and investors.1 In addition to these three indexes, there are approximately 5,000 others that make up the U.S. equity market.
- There are approximately 5,000 U.S. indexes.
- The three most widely followed indexes in the U.S. are the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite.
- The Wilshire 5000 includes all the stocks from the U.S. stock market.
- Indexes can be constructed in a wide variety of ways but they are commonly identified generally by capitalization and sector segregation.
