An Index whose purpose is to reveal the Performance of the entire market, such as the S&P 500, Wilshire 5000, AMEX Major Market Index or Value Line Composite Index. Different broad-base indices have different approaches to ensuring that the Index captures the entire breadth of market Activity. The Wilshire 5000 takes the most all-inclusive approach by including all the stocks Listed on the New York Stock Exchange and almost all the stocks Listed on the Nasdaq and American Stock Exchange. The S&P 500 includes 500 companies that are together considered a good Indicator for the US Stock market, based on the industries the companies operate in, their positions within the Industry, and their Market capitalization. The S&P 500 is a market-weighted index, so only 10% if ITS components make up about 75% of ITS value. The Value Line Composite Index takes an in between approach by Tracking 1700 issues. The Value Line Composite is thought to be a better Indicator of speculative stocks than of more stable stocks.
