Indexes and Benchmarks
Index
A list of securities grouped together to measure how a section of the market is performing.
Also called: market index
What it means
An index tracks the performance of a group of investments, such as stocks or bonds. For example, an index might follow the largest U.S. companies, technology companies, or bonds issued by governments. Indexes are used as reference points, not things you usually buy directly.
Why it matters
Indexes help people measure performance and understand whether a portfolio or fund is doing better or worse than a chosen market segment.