What Is An Index?

An index is a measure of an economy and in financial terms, it is a synthetic (imaginary) portfolio which aims to represent a specific market. As this is just a benchmark and aims to only represent the change in value of an economy, the percentage change is usually the most important value (rather than the actual change in value).

Some of the best-known indices in the world are:

  • S&P500
  • FTSE100
  • Dow Jones Industrial Average
  • Nikkei

Related Terms

Return to Finance Dictionary

Start Discussion

Total Avg Compensation

April 2021 Investment Banking

  • Director/MD (9) $911
  • Vice President (34) $348
  • Associates (185) $233
  • 2nd Year Analyst (106) $150
  • Intern/Summer Associate (96) $145
  • 3rd+ Year Analyst (26) $145
  • 1st Year Analyst (391) $132
  • Intern/Summer Analyst (318) $82