An index gives you a snapshot of the overall performance of a particular market sector, for example all of the companies making software. It spares you the work of analysing how each company is doing individually. You’ve probably heard of the Dow Jones Industrial Average, which combines the trade results of the 30 most giant American companies (which change over time, but right now include Coca-Cola, Microsoft and Walt Disney). There are other indexes that look specifically at Canadian companies (S&P/TSX Composite Index), or companies around the world (Dow Jones Global Index).
If a company was an apple pie, a stock would be a slice of the pie. In short, a stock is a slice of a company. Everyone who owns a piece of a company has the right to share a portion of the profits of the company. Read more
The stock market encompasses all the people, companies and institutions buying and selling slices of publicly-owned companies and other securities. Read more
Exchange traded funds (ETFs) are a pool of investments sold as a single product. Remember those cheesy christmas basket, filled with the standard jam jars and hot chocolate mix, your parents might have received? Read more