Broad-Based Index


DEFINITION of 'Broad-Based Index'

An index designed to reflect the movement of the entire market. The smallest broad-based index is the Dow Jones Industrial Average with 30 industrial stocks and the largest is the Wilshire 5000 Total Market Index. Other examples include the S&P 500, Russell 3000 Index, AMEX Major Market Index and the Value Line Composite Index.

BREAKING DOWN 'Broad-Based Index'

Investors who want the maximum benefit of diversification can invest in securities that have as their underlying tracking instrument an index or other financial product made up of several, well-diversified stocks. Securities based on broad-based indices allow investors to effectively own the same basket of stocks contained in a major index while committing a small amount of financial resources.

  1. Topix Core 30 Index

    The Topix Core 30 Index is a market index composed of 30 of ...
  2. Russell 2000 Index

    An index measuring the performance approximately 2,000 small-cap ...
  3. Index

    A statistical measure of change in an economy or a securities ...
  4. Wilshire 5000 Total Market Index ...

    A market capitalization-weighted index composed of more than ...
  5. Index Fund

    An index fund is a type of mutual fund with a portfolio constructed ...
  6. Value Line Index

    A stock index containing approximately 1,675 companies from the ...
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