What is a stock index?

Updated 22.09.2026

A stock or share index is an average indicator of price changes in a certain group of securities. You can imagine a stock index as a basket of shares united by some feature. Investors use indices as a standard for tracking changes in the entire market or in a certain market segment.


One of the interesting features of stock indices is that they are not traded on the stock exchange, but rather calculated. The price of the index is expressed not in currency, but in points. You cannot buy an index directly, but there are financial instruments that track the dynamics of indices and help invest in them. For example, exchange-traded funds (ETFs).


The most popular index is the S&P 500. It tracks the stock prices of 500 of the most famous companies on the planet (mostly American).


Other well-known indices are the Dow Jones 30 and the NASDAQ 100/NASDAQ Composite.


The KASE index and the AIX Qazaq index are calculated on Kazakhstan exchanges.

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