Index


 

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Index

In the stock market, an index is a device that measures changes in the prices of a basket of shares, and represents the changes using a single figure. The purpose is to give investors an easy way to see the general direction of shares in the index.The FTSE 100, for example, is calculated by taking a weighted average of the share prices of the largest 100 companies on the London Stock Exchange. Launched in 1984 with a base figure of 1,000, the FTSE is calculated continuously throughout the trading day. When the media report that 'FTSE climbed 37 points today' you don't know exactly which shares in the index climbed and which fell, but you get an immediate idea of the direction of the market.Index funds base their investment decisions on tracking the companies in a particular index.

Index

Statistical composite that measures changes in the economy or in financial markets, often expressed in percentage changes from a base year or from the previous month. Indexes measure the ups and downs of stock, bond, and some commodities markets, in terms of market prices and weighting of companies the index.



Index

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Lehman Brothers Mortgage Backed Securities Index

Lehman Brothers Mortgage Backed Securities Index

A benchmark index that includes 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal Home Loan Mortgage Corporation (FHLMC), and Federal National Mortgage Association (FNMA).


Index linked family income assurance

Index linked family income assurance

Family income assurance in which the assured may, if he or she chooses, increase premiums in line with the retail price index and hence increase the sum assured.


Relative strength index

Relative strength index

A widely used index which compares a company's share price to a broadly-based market index like the FTSE All-Share. The point of the comparison is to show whether historically the company share price outperforms or underperforms the index.Because the RSI is a ratio, it will increase as a share moves higher relative to the market, and decrease as the share moves lower relative to the market. Its main use is to enable investors to avoid shares that have a history of relative underperformance and to chose those that have a history of relative outperformance.In commercial charts, the RSI is usually superimposed on the bottom third of the share price chart, or sometimes in its own box underneath the main chart.


Price index

Price index

A measure of the average prices of a group of goods relative to a base year. A typical price index for a vector of quantities q and prices pb, pg in the base and given years respectively would be I = 100Spgq / Spbq.


Trade intensity index

Trade intensity index

For a group or bloc of countries, usually in a PTA, the ratio of the bloc's share of intra-bloc trade to the bloc's share in world trade. If greater than one, this is said to suggest that the bloc displays trade diversion. Index seems to be due to Frankel (1997).


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