Index number

Definition:

A way to standardize the price changes of goods that have much different prices. For example, a consumer price index might be represented by a shopping cart of goods. Suppose those goods cost $324. The index would begin by dividing by 3.24 and the initial value would be 100. One usually watches the percentage increases or decreases in the index. See: Consumer Price Index (CPI), Time series models

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Underwrite

To guarantee, as to guarantee the issuer of securities a specified price by entering into a purchase and sale agreement. To bring securities to market.

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