Question

Market performance in the United States is tracked using stock
, which use formulas to calculate price

Answer 1

You probably mean "stock indexes" (or "stock indices"). A clear completion and short explanation:

"Market performance in the United States is tracked using stock indexes, which use formulas to calculate index levels from the prices or market capitalizations of their component stocks."

Short summary of common index formulas and how they work:

- Price‑weighted (example: Dow Jones Industrial Average)
- Formula (concept): Index = (Sum of component stock prices) / Divisor
- Each stock’s weight is proportional to its share price. The divisor is adjusted for splits, spin‑offs and similar events so the index remains continuous.

- Market‑capitalization‑weighted (examples: S&P 500, Nasdaq Composite, Russell 2000)
- Formula (concept): Index ∝ Sum for all components of (Price_i × Shares Outstanding_i × Free‑float factor_i)
- In practice: Index = (Current total market cap of constituents / Base period market cap) × Base index value
- Larger companies have larger weights. Free‑float adjustments exclude shares not available to the public.

- Equal‑weighted
- Each constituent has the same weight. The index return is typically the arithmetic average of component returns; the level is scaled to a base value.

- Fundamental‑ or factor‑weighted
- Weights are based on fundamentals (book value, earnings, sales) or factor scores instead of price or market cap.

Other notes:
- Index providers adjust divisors and weights to account for corporate actions (splits, dividends, mergers) so index history is consistent.
- Indices are benchmarks — you can’t invest directly in an index, but you can buy funds that aim to replicate them (ETFs, mutual funds).

If you want, I can:
- Fix the sentence in a single concise line, or
- Show the exact DJIA and S&P 500 calculation using a numeric example, or
- Explain how divisors are adjusted for splits and dividends. Which would you prefer?