Price-weighted index

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Price-weighted index

An index giving a greater influence to higher-valued stocks by weighting all component stocks by their price.

Price-Weighted Index

An index that tracks a number of securities in which price changes in stocks that already have higher prices affect the index's price changes more than other securities. For example, suppose an index tracks three stocks: A, B, and C. If A has a higher price than B and C, an uptick in A will be more likely to result in an uptick in the index as a whole (depending on how much more weighted it is). Price weighted indices are less common than capitalization-weighted indices, but the Dow Jones Industrial Average is a prominent example.
References in periodicals archive ?
This price weighted index is comprised of 100 listed and over-the-counter securities.
The PHLX OTC Prime Sector (OTX), is a price weighted index of the 15 most active stocks traded on the NASDAQ, with corporations involved in a variety of industries including: electronic components, telecommunications, wide-area networks, computer and computer component manufacturing, computer software and Internet services.