What does the stock market number represent?

Answer 1

it represents all the shares in the basket expreesed as a index
there are lots of different index's people follow and each is made up of differenet shares

the index's are manly used as abenchmark to determine the performance of portfolio managers

Answer 2

The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the Nasdaq. The DJIA was invented by Charles Dow back in 1896.


Often referred to as "the Dow", the DJIA is the oldest and single most watched index in the world. The DJIA includes companies like General Electric, Disney, Exxon and Microsoft.

When the TV networks say "the market is up today", they are generally referring to the Dow.

Standard & Poor's 500 Index - S&P 500, is an index consisting of 500 stocks chosen for market size, liquidity and industry grouping, among other factors. The S&P 500 is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large-cap universe.

Companies included in the index are selected by the S&P Index Committee, a team of analysts and economists at Standard & Poor's. The S&P 500 is a market-value weighted index - each stock's weight in the index is proportionate to its market value.


The S&P 500 is one of the most commonly used benchmarks for the overall U.S. stock market. The Dow Jones Industrial Average (DJIA) was at one time the most renowned index for U.S. stocks, but because the DJIA contains only 30 companies, most people agree that the S&P 500 is a better representation of the U.S. market. In fact, many consider it to be the definition of the market.

Other popular Standard & Poor's indexes include the S&P 600, an index of small-cap companies with a market capitalization between $300 million and $2 billion, and the S&P 400, an index of mid-cap companies with market capitalizations of $2 billion to $10 billion.

A number of financial products based on the S&P 500 are available to investors. These include index funds and ETFs. However, it would be difficult for individual investors to buy the index, as this would entail buying 500 different stocks.