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Index

A basket of securities that tracks part of the market, used as a benchmark.

Market BasicsBeginner

Definition

An index measures the performance of a group of securities such as large US stocks or Canadian banks. You cannot buy an index directly, but funds that track one can be bought. Indexes differ in how they pick and weight their members.

How it is used

Indexes are the yardstick for judging whether a fund or portfolio is doing better or worse than the market.

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