Performance index

Index which, in contrast to a price index, is adjusted for dividend payments, changes in the capital stock, or interest payments.

The most important stock and bond indices are calculated by FWB Frankfurter Wertpapierbörse (the Frankfurt Stock Exchange) as both price and performance indices. In calculating a stock performance index, dividends and other payments to shareholders are reinvested in the notional portfolio. Bond performance indices are calculated taking into account the income generated by reinvesting the discounted average annual interest payment.

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