Market Average

AAA

DEFINITION of 'Market Average'

A measure of the overall price level of a given market, as defined by a specified group of stocks or other securities. A market average equals the sum of all current values of stocks in the group divided by the total number of shares in the group.

INVESTOPEDIA EXPLAINS 'Market Average'

A market average measurement is a simple way to evaluate the price level of a group of stocks. For example, the Dow Jones Industrial Average, which is a price-weighted average, covers 30 blue chip stocks listed on the NYSE and is widely used to track overall U.S. stock market performance.

RELATED TERMS
  1. Moving Average - MA

    A widely used indicator in technical analysis that helps smooth ...
  2. Index

    A statistical measure of change in an economy or a securities ...
  3. Blue Chip

    A nationally recognized, well-established and financially sound ...
  4. Mean

    The simple mathematical average of a set of two or more numbers. ...
  5. Weighted Average Market Capitalization

    A stock market index weighted by the market capitalization of ...
  6. Dow Jones Industrial Average - ...

    The Dow Jones Industrial Average is a price-weighted average ...
RELATED FAQS
  1. What is the best way to measure the total market?

    There is a variety of market indices which function as statistical gauges of the market's activities. Many investors look ... Read Full Answer >>
  2. What is the difference between shares outstanding and floating stock?

    Shares outstanding and floating stock are different measures of the shares of a particular stock. Shares outstanding is the ... Read Full Answer >>
  3. What is the difference between market risk premium and equity risk premium?

    The only meaningful difference between market-risk premium and equity-risk premium is scope. Both terms refer to the same ... Read Full Answer >>
  4. What is the difference between the QQQ ETF and other indexes?

    QQQ, previously QQQQ, is unlike indexes because it is an exchange-traded fund (ETF) that tracks the Nasdaq 100 Index. The ... Read Full Answer >>
  5. What is the difference between an investment and a retail bank?

    The activities and types of clients for an investment bank versus those for a retail bank highlight the primary difference ... Read Full Answer >>
  6. Will technology ever disrupt the role of the custodian bank?

    Custodian banks, along with other financial institutions that hold custodian accounts, are likely to be disrupted but not ... Read Full Answer >>
Related Articles
  1. Bonds & Fixed Income

    How Now, Dow? What Moves The DJIA?

    Find out how this index tracks market movements and where it falls short.
  2. Mutual Funds & ETFs

    Index Investing

    Get to know the most important market indices and the pros and cons of investing in them.
  3. Stock Analysis

    Why Hasn't McDonald's Beaten The Dow Recently?

    McDonald's has underperformed the Dow Industrials since 2009, but a reorganization and buyback could turn things around.
  4. Investing Basics

    Understanding NASDAQ

    NASDAQ is an acronym that stands for the National Association of Securities Dealers Automated Quotation system.
  5. Investing Basics

    Explaining the Equity Market

    Equity market is a general term referring to a place were corporate stocks are sold.
  6. Economics

    Is The Yuan The New Greenback?

    China is increasingly top of mind for investors. While bulls see an opportunity in a massive equity rally, bears are focused on a slowing economy.
  7. Economics

    Why To Pay Attention To Today’s Buyback Boom

    There has been a lot of debate recently about whether today’s buyback boom, $133 billion for S&P companies, is good or bad for the economy and for markets.
  8. Options & Futures

    How To Buy Options On the Dow Jones

    We show why buying options on the Dow Jones is a good alternative to trading the exchange-traded fund.
  9. Forex

    Capital And Labor: Who Wins The Trans-Pacific Partnership?

    With President Obama securing fast track authority on the Trans-Pacific Partnership, the benefits for labor and capital can be examined.
  10. Investing

    Which Dow Jones Stocks are Safe? Which are Risky?

    In a situation where our sustained bull run could turn into a sell-off rather quickly, here are four somewhat safe Dow stocks and four to be wary of.

You May Also Like

Hot Definitions
  1. National Currency

    The currency or legal tender issued by a nation's central bank or monetary authority. The national currency of a nation is ...
  2. Treasury Yield

    The return on investment, expressed as a percentage, on the debt obligations of the U.S. government. Treasuries are considered ...
  3. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  4. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
  5. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
  6. Current Account Deficit

    A measurement of a country’s trade in which the value of goods and services it imports exceeds the value of goods and services ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!