Definition: A benchmark is an unmanaged group of securities which are considered as a 'benchmark' to measure a fund's/stock's performance. Benchmarks are generally broad market indices like BSE Sensex, CNX Nifty of the Indian stock market with which mutual fund returns are compared.
Description: If a fund returned 59% in a particular year, but the benchmark Sensex returned 70%, this infers the fund underperformed compared to the Sensex benchmark.
A benchmark indicates directly the fund manager's performance. For instance, a mutual fund which outperforms the benchmark is a sign of an efficient fund manager.
Also See: Fund Categories, Mutual Fund, Hedge Fund, ETF, Index Funds
Myra Pasquier and Susan Gomez-Zwiep (2006) recommend several tips to teachers wanting to create their own benchmark assessments to measure students’ developmental growth. 8 First, Pasquier and Gomez-Zwiep suggest that questions must be worded carefully so that the expected answer is clear to students and that each question must be structured around an end goal. Paswquier and Gomez-Zwiep also advise that teachers use clear rubrics to demonstrate what their expectations are for student work. Developing appropriate benchmark assessments takes time and practice; consequently, Pasquier and Gomez-Zwiep caution teachers to be patient and to improve their own content knowledge before implementing benchmark assessments in their practice.