Benchmark
Definition
A standard or index against which the performance of a portfolio or investment manager is measured.
Explanation
Choosing the right benchmark is critical for meaningful performance evaluation. A US large-cap portfolio should be measured against the S&P 500, not the Russell 2000. A global equity fund should use MSCI ACWI. Common benchmarks: S&P 500 (US large-cap), Russell 2000 (US small-cap), MSCI EAFE (developed international), Bloomberg Aggregate (US bonds). Benchmark-relative metrics include tracking error, information ratio, and active share.
How Stoquity Uses This
Stoquity incorporates benchmark analysis across its portfolio management platform, providing real-time monitoring and AI-powered insights for every portfolio.