What Is a Stock Market Index? Defined and Listed

What Is a Stock Market Index?

By Dan Caplinger – Updated Sep 11, 2025 at 10:29 AM | Fact-checked by Margo Winton Parodi

Key Points

Stock market indexes help investors gauge general market conditions across various sectors.
Different indexes target specific market segments, aiding in tailored investment decisions.
Index funds offer a cost-effective way to match overall market performance for long-term gains.

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The word Index against a background of colored stripes. — Source: Getty Images

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Dow Jones

Tracks 30 of the largest and most important U.S. companies -- and the price-weighted list doesn't change frequently.

S&P 500

A barometer of the overall stock market's performance that contains 500 companies, weighted by market cap, from across different sectors.

Nasdaq

This index includes the roughly 3,000 companies that are part of the Nasdaq stock exchange and is predominately focused on technology.

Russell 2000

This index is widely considered the benchmark for smaller U.S. stocks.

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Indexes by types of stock

S&P 500 Value Index: This index consists of the stocks in the S&P 500 that are considered to have "value characteristics." These are generally stocks that trade for relatively low multiples of their book values and earnings, and tend to be more mature, slower-growing companies. Some of the largest stocks in this index include JPMorgan Chase (JPM -1.70%), Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B), Microsoft (MSFT +0.25%), and ExxonMobil (XOM +0.07%).
S&P 500 Growth Index: The stocks in the S&P 500 considered to have "growth characteristics" make up this index. While there are no specific cutoffs to distinguish growth stocks, they are generally (but not always) companies with above-average sales growth and trade for relatively high price-to-earnings ratios. Some of the largest stocks in the S&P 500 Growth Index are Apple (AAPL +0.33%), Amazon (AMZN +2.64%), Meta (META +0.24%), and Visa (V +0.84%).

Indexes by market capitalization

Technically, the S&P 500 is a part of a total-market index known as the S&P 1500. The S&P 500 is the large-cap portion, but other segments are:

S&P MidCap 400: This index tracks the middle of the market. From an investors' perspective, mid-cap stocks are often seen as a nice compromise between lower volatility and high long-term return potential.
S&P SmallCap 600: This index tracks 600 small-cap companies, although the Russell 2000 is a much more widely used index for small caps.

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By periodically investing in an index fund, for example, the know-nothing investor can actually outperform most investment professionals.
Warren Buffett

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About the Author

Dan Caplinger is a contributing premium stock analyst and financial planning expert at The Motley Fool. In addition to The Motley Fool, Dan has experience as a tax and estate planning attorney, trust officer, financial planner, and wealth advisory supervisor. He holds a bachelor’s degree in economics from the University of Chicago and a law degree with high honors from the University of Texas School of Law.

TMFGalagan

JPMorgan Chase is an advertising partner of Motley Fool Money. Dan Caplinger has positions in Amazon, Apple, Berkshire Hathaway, JPMorgan Chase, Meta Platforms, and Microsoft. The Motley Fool has positions in and recommends Amazon, Apple, Berkshire Hathaway, JPMorgan Chase, Meta Platforms, Microsoft, and Visa. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.