As part of World Investor Week, Euronext is proud to continue our Next Generation series designed to prepare young and first-time investors with the tools they need to build financial confidence. We believe that financial empowerment begins with a solid understanding of the fundamentals.
This article is the third in a three-part series in celebration of World Investor Week designed specifically for first-time investors, with the aim of making investing more accessible, understandable and empowering for those just beginning their investment journey.
One of the most important yet often overlooked fundamentals in investing is the stock market index. Whether you are just beginning your investment journey or simply curious about how markets function, grasping what an index is and why it matters can offer a clearer view of how economies evolve and investments grow.
What is a stock market index?
A stock market index is essentially a benchmark to measure how a specific group of financial assets, usually company shares, are performing at a given time. But indices cover more than just stocks – they can track bonds, commodities or even newer asset classes like cryptocurrencies. An index is comparable to a snapshot of the health and trends of a particular market segment.
Indices serve several key purposes:
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Tracking the overall health of a market or economy
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Serving as the foundation for investment products such as ETFs (exchange-traded funds)
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Acting as performance benchmarks for portfolios and investment strategies.
The CAC 40®: France’s economic heartbeat
In France, the CAC 40® stands out as the most recognised index and a symbol of national economic strength and resilience. Managed by Euronext, the CAC 40® was created in 1987 with a base value of 1,000 points. Since then, it has reflected the changing tides of both the French and global economy from the tech boom of the early 2000s to today’s focus on luxury, innovation, energy, finance, health and defence sectors.
In May 2024, the CAC 40® reached a record high of 8,295 points, highlighting France’s evolving economic landscape. Companies like L’Oréal, LVMH, TotalEnergies and Michelin have been pillars of the index since its inception, demonstrating enduring market leadership.
The AEX®: a broader view of the Dutch market
In September 2025, the AEX®, Euronext’s flagship index for the Dutch market, expanded from 25 to 30 companies for the first time since its creation in 1983. This change followed a thorough market consultation and reflects Euronext’s efforts to better represent the diversity and scale of the Dutch economy. By increasing the number of constituents and updating its methodology, the AEX ® now offers investors broader exposure to leading Dutch-listed companies and improved index diversification. Alongside the CAC 40®, the AEX® remains one of Euronext’s most important benchmark indices, helping channel investment into national and international leaders based in Amsterdam. Euronext’s other national benchmarks include the MIB for Italy, PSI for Portugal, BEL 20 for Belgium, the OBX for Norway, and the ISEQ for Dublin.
A reflection of the economy
Indices are living benchmarks. Their composition is regularly reviewed and adjusted to mirror the changing economy and the emergence of new sectors. Today’s indices are built on transparent, rules-based methodologies, giving investors clarity on what they are investing in and why.
Euronext manages more than 1,800 indices delivering market coverage across blue-chip national indices, fixed income, ESG, crypto, and thematic sectors such as AI, healthcare, space, cybersecurity, and more, catering to the growing demand from investors seeking tailored exposure to various markets and strategies.
How indices are created
Creating and maintaining an index is a complex process involving financial engineers, analysts and data specialists. These teams set clear rules, calculate index values and ensure accurate, timely data dissemination, influencing billions in investment decisions worldwide.
Indices can be broad or focused on specific themes such as clean energy, artificial intelligence, or sustainable investing. Many are developed in collaboration with banks, asset managers and other institutions to support investment products like ETFs and structured financial instruments.
Investing with purpose
Environmental, social and governance (ESG) factors have reshaped index design. Euronext pioneered low-carbon indices in 2008 and now offers ESG-focused versions of major indices like the CAC 40 ESG®, AEX ESG®, MIB ESG® and BEL ESG®. These enable investors to align their portfolios with personal values and global sustainability goals.
Additionally, thematic indices tracking sectors such as healthcare, fintech or companies supporting job creation in France provide investors with targeted exposure to emerging opportunities.
Why indices matter for new investors
For those new to investing, indices offer insights into the market’s broad trends. Many investment products, including ETFs, are built on indices, and provide a cost-effective and diversified path to participate in economic growth, reducing risks associated with single stock exposure.
Euronext joins the CAC 40®: a milestone in our journey
As of 22 September 2025, Euronext, itself a listed company, has proudly joined the CAC 40®, marking a significant milestone in our transformation as a company from a national exchange operator to a leading, integrated European capital markets group. This inclusion recognises more than a decade of strategic growth and diversification, reinforcing our commitment to innovation, scale and supporting Europe’s financial future.
Discover more about Euronext’s inclusion and our journey in the Euronext CAC 40® introduction brochure.
Learn more
To learn more about how indices work and to access practical resources tailored for first-time investors visit the Euronext Education Centre.