What is a stock price index
Definition: A stock index, also known as a stock market index, measures the weighted average of the value of selected stocks that follow the index to help investors and traders determine a market’s return on investment. A stock index or stock market index is an index that measures a stock market, or a subset of the stock market, that helps investors compare current price levels with past prices to calculate market performance. A stock index is a compilation of stocks constructed in such a manner to track a particular market, sector, commodity, currency, bond, or another asset. For example, the NDX is an index that tracks the largest 100 non-financial companies listed on the NASDAQ.