point business definition

A unit of change in the value of a security or a security index or average. For common and preferred stocks, a point represents a change of $1. For bonds, a point represents a 1% change in face value. For example, a one-point decline in a $1,000 principal amount bond translates to a $10 decline in price. For stock averages and indexes, a point represents a unit of movement and is best interpreted as a percent of the beginning value. For example, a 120-point decline in the Dow Jones Industrial Average that started the day at 12,000 represents a 1% fall in the average.