An index stock, or stock market index, is a statistical measure of change in a securities market. It is an index that measures the performance of a stock market, or of a subset of a stock market. An index tracks the performance of a group of preselected investments, such as stocks or bonds, in a standardized way. It can be used to track the performance of a group of assets in a standardized way. The methods of constructing an index are specified, and it is investable and transparent. Investors may be able to invest in a stock market index by buying an index fund, which is structured as either a mutual fund or an exchange-traded fund, and "track" an index. The difference between an index funds performance and the index, if any, is called tracking error. Indexes typically measure the performance of a basket of securities intended to replicate a certain area of the market. There are thousands of indexes in the investing universe, and each index measures a specific market, market segment, or investment strategy in which investors might choose to invest. Some of the most well-known stock market indexes include the S&P 500, the Dow Jones Industrial Average, and the Nasdaq. Index funds are popular with investors because they offer immediate diversification, lower risk, and ownership of a wide variety of stocks, usually at a low cost.