Glossary · from the DESK dictionary
Benchmark
A reference index against which a portfolio's or fund's performance is measured.
In plain words
The "yardstick" a fund manager or strategy is measured against.
Example
A US equity fund is typically measured against the S&P 500 as its benchmark.
What it means for traders
A fundamental concept for assessing whether active management actually adds value.
Common pitfalls
A poorly chosen benchmark can misrepresent a manager's actual performance.
Related terms
Absolute Return · Active Return · Alpha · Attribution Analysis · Bogey · Market Index · OMX Stockholm 30 · Relative Performance · S&P/TSX Composite · Stoxx Europe 600 · Straits Times Index
From the DESK dictionary. For information only, not investment advice.
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DESK is a research tool and not investment advice. Page generated: 2026-10-12.