# Market Index

*Saving & Investing — Finicade finance glossary*

A market index is a rules-based basket of securities used to represent a market's performance. Most are capitalisation-weighted, so a company's influence scales with its size — which is why a handful of mega-caps can drive an entire index. Alternatives weight by price (the Dow) or equally. An index is a measurement, not an investment: you access it through a fund that tracks it, and the tracking difference plus fees is what separates the two.

**Also known as:** stock index, index, equity index

**Related terms:** [S&P 500](https://finicade.com/glossary/sp-500), [Index Fund](https://finicade.com/glossary/index-fund), [Benchmark](https://finicade.com/glossary/benchmark), [Market Capitalization](https://finicade.com/glossary/market-capitalization), [ETF (Exchange-Traded Fund)](https://finicade.com/glossary/etf)

**Taught in:** Quant Quest — Equities & Equity Indices

Source: https://finicade.com/glossary/market-index