Series 7: 9.4.3 Market Indexes

9.4.3  Market Indexes

An index is a basket of securities that are chosen to reflect a certain market. A broad-based index is one that is meant to capture the performance of the entire market.

• • The smallest broad-based index is the Dow Jones Industrial Average. It is the best-known and oldest equity index in the U.S., but it tracks just 30 stocks.
• • The S&P 500 is an index of 500 representative large-cap, publicly traded companies drawn from the primary sectors of the U.S. economy. The S