Broad-Base Index

Broad-base Index - The broad-base index is an index whose only purpose is to show how the entire market is performing, such as the Wilshire 500, the S & P 500, the AMEX Major Market Index, and the Value Line Composite Index. All stock markets and stock exchanges have varying broad-base indices with different approaches to guarantee that the index used captures the entire span of the market's activity. Each is usually based on their best companies and industry offered in their markets or exchanges, which are recorded and can be measured using various formulas to calculate their capitalization.