Indices
Indices are baskets of financial instruments that gauge their collective performance. For instance, stock market indices like Nifty 50 and Sensex track the top 50 and 30 stocks by market cap, respectively. Rising indices typically signal strong performance of the underlying stocks, while a drop suggests the opposite. The number of instruments an index tracks varies—Nifty Smallcap 250 monitors 250 stocks, while Nifty Bank follows just 12. There’s no fixed limit to how many an index can include, making them flexible tools for assessing market trends and investor sentiment across different segments.
Related Terms
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Enterprise Value
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Long-Term Stocks
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Alpha
Alpha is a performance metric that measures how much a stock or portfolio has outperformed...
Adjusted Futures Price
An adjusted futures price shows the cost of purchasing, financing, and delivering the underlying assets...
Bull Market
A bull market describes a sustained upward trend in the stock market. It signals optimism...
