Learn about the Stock Index

Learn about the stock index in this series of financial advice videos.

What is a Stock Index? David Marotta: A Stock Index is a number used to represent the movement of a whole collection stocks. So, you take all of the stocks and you look at all there movements up and down in the markets and you comprise to one number. Usually the stocks are waited for the larger companies count more than the smaller companies. That’s we call Cap Waited Index sometimes they are in Equal Waited Index meanings that you just count each one equally. Sometimes they are price waited index, that’s very rare but that’s how the Dow is. In a Price Waited Index a stock that has a higher price when it moves by a dollar doesn’t count as much as a stock that has a lower price because the lower price are the stock movement of the dollars is actually a higher percentage rate of movement but it doesn’t count for any more than the larger stock.