What Are Financial Market Indexes?

3 years ago
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What is a stock market index? Indexes can represent a broad or narrow segment of the financial markets. Calculations are made based on the stock values that make up an index. Stock market indices can be:
- price-weighted, like DOW index;
- value-weighted (number of shares), like SPX index;
- unweighted.

I'm also talking here about the popular US indexes and showing major world market indices which you can also find under this link: https://www.investing.com/indices/major-indices

How to invest in an index? Investors don't directly invest in an index but use them as broad-based benchmarks and for developing index funds and ETFs.

Types of indexes:
Narrow indexes
Sectors, i.e. Tech;
Micro-sectors like SOX Index;
Bond indexes;
Geographic segment (Emerging markets);
World indexes like ACWI, DAX, etc.

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