What are indices?

Indices are a measurement of price of a certain set of securities listed on an exchange. Indices are also called an index. Very commonly known indices are:

All these indices track a specific type of stock mostly based on size or market capitalization (current stock price * amount of outstanding shares). Companies can go in and out of indices many times. Most indices track the biggest companies. If a company goes bankrupt or loses a lot of net worth, the company leaves the index and another company takes its spot. When an ETF or mutual fund tracks an index, it tracks an indice.

Good job! You gained 5 XP and 0   0   5 . What's next:

• Share my article with someone you think should learn this too: Share
• Let me know what you think in the comments.
• Want to learn more? Click on the next article below. You gain another 5 XP and 0   0   5 .
• Join the community if you want to keep your earnings and track your progress: Join the community