A benchmark is a reference or comparative measure used to evaluate the performance or success of an investment, fund, portfolio or other financial product. It serves as a comparative value to measure and analyze the results or returns of an investment. For example, a benchmark can be a well-known stock index such as the S&P 500 or the FTSE 100, or a specific index for a particular asset class. Comparing the performance of an investment against its benchmark allows investors or fund managers to determine whether the investment is outperforming or underperforming the market or the specific asset class. Benchmarks serve as an important guide for investors to evaluate the results of their investments and analyze risk-return ratios.