What is HH Index?

The Herfindahl-Hirschman Index (HHI) is a measure of market concentration used to assess the level of competition within an industry. It is calculated by summing the squares of the market shares of all firms in the market, resulting in a value ranging from 0 to 10,000. A higher HHI indicates greater concentration and less competition, while a lower HHI suggests a more competitive market. The HHI is often used by regulatory agencies to evaluate potential Mergers and Acquisitions.