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The performance of a predetermined set of securities, used for comparison purposes. Such sets may be based on published indexes or may be customized to suit an investment strategy.


A standard against which a security's performance is compared. A benchmark is usually an index of securities of the same or similar class. Stocks are usually compared against stocks; bonds against bonds, etc. Another type of benchmark considers securities according to industry: a telecommunications stock may be compared to other telecommunications stocks. Likewise, mid-cap securities may be benchmarked against other mid-cap securities. Some indices, such as the Dow Jones Industrial Average and the S&P 500, are considered to be benchmarks for the wider economy.


A standard by which something is measured. For example, bond yields are generally compared to benchmark yields on U.S. Treasury securities of similar maturity. Mutual fund performance is often compared to changes in the Standard & Poor's 500 Stock Index.


An investment benchmark is a standard against which the performance of an individual security or group of securities is measured.

For example, the average annual performance of a class of securities over time is a benchmark against which current performance of members of that class and the class itself is measured.

When the benchmark is an index tracking a specific segment of the market, the changing value of the index not only measures the strength or weakness of its segment but is the standard against which the performance of individual investments within the segment are measured.

For example, the Standard & Poor's 500 Index (S&P 500) and the Dow Jones Industrial Average (DJIA) are the most widely followed benchmarks, or indicators, of the US market for large-company stocks and the funds that invest in those stocks.

There are other indexes that serve as benchmarks for both broader and narrower segments of the US equities markets, of international markets, and of other types of investments such as bonds, mutual funds, and commodities.

Individual investors and financial professionals often gauge their market expectations and judge the performance of individual investments or market sectors against the appropriate benchmarks. In a somewhat different way, the changing yield on the 10-year US Treasury bond is considered a benchmark of investor attitudes.

For example, a lower yield is an indication that investors are putting money into bonds, driving up the price, possibly because they expect stock prices to drop. Conversely, a higher yield indicates investors are putting their money elsewhere.

Originally the term benchmark was a surveyor's mark indicating a specific height above sea level.


A permanent reference mark,usually set in concrete or iron and used to establish the elevation above sea level or certain corners in a surveying system. All other measurements in the area should be checked for accuracy relative to the nearest benchmark, preferably against several nearby benchmarks to establish redundancy.

References in periodicals archive ?
One improvement tool available to finance executives is Power-MARQ, a global database of more than 1,200 performance indicators and individual benchmarks for companies to improve their operations.
Review of Benchmark Enhancements - The panel reviewed benchmark enhancements to ensure the effectiveness of changes.
The Transaction Processing Performance Council (TPC) is a non-profit corporation founded to define transaction processing and database benchmarks and to disseminate objective, verifiable TPC performance data to the industry.
In support, the SPC is a non-profit corporation that defines, standardizes, and promotes storage subsystem benchmarks as well as disseminates objective, relevant, and verifiable performance data and related test tools to the computer industry and its customers.
The suite of twelve algorithm kernel benchmarks represents key operations found in digital signal processing applications used in fields such as telecom and audio.
The Council's first benchmark (SPC-1) is designed to have broad market appeal and provide a level playing field between "open" providers of storage (either direct attach or storage networks).
0, the mobile device industry will have access to the first benchmark intended to simulate accurate, consistent 3D performance prior to the investment in silicon hardware.
Improvements in SPEC CPU2006 include new and expanded benchmarks that represent a wider range of application areas; larger applications with greater complexity that better represent what today's users are running; and larger and longer-running workloads that take into account today's system capabilities and provide headroom for future performance growth.
CompTIA Customer Loyalty Benchmark - Measurement and benchmarking of customer loyalty for manufacturers and service providers in the computing hardware sector.
We're pleased to again be the first benchmark developer to recognize the significance of this technology," said Tero Sarkkinen, Executive Vice President of Sales and Marketing for Futuremark.
This publication leverages the APQC Open Standards Benchmarking Collaborative(SM) (OSBC) research, which helps executives and managers benchmark within their industry and with best-in-class organizations.