IDEAS home Printed from
   My bibliography  Save this article

What lies beneath




For most investors, an index is a number. The number tells them something about the current state of a market for stocks, bonds, credit derivatives, or some other instrument, be it foreign or domestic. For those that have invested in an index fund, the change in that number from day to day closely represents the movements of their portfolio. Not too many people think much about what it takes to produce that number, and the few that do usually regard the process as a bit murky no matter how clearly stated the index methodology may be. Imaginative folks may envision a troop of grumpy gnomes scribbling with quill pens, feeding their handiwork to awaiting index fairies that deposit the results under the pillows of financial publishers everywhere. In truth, of course, the process involves complex computer systems and endless cycles of research and adjustment. Like an iceberg, the visible part of an index misleads even informed viewers about the immensity, and the importance, of work that lies beneath the surface.

Suggested Citation

  • Hamich, Lars, 2004. "What lies beneath," Journal of Financial Transformation, Capco Institute, vol. 11, pages 48-51.
  • Handle: RePEc:ris:jofitr:1360

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    More about this item


    Indices; index methodology;

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:jofitr:1360. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Prof. Shahin Shojai). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.