ABX is a tradeable index. It is based on a series of baskets of 20 credit derivatives which relates to the subprime mortgage loans.
The instruments’ price was based as a measure of the risk associated with various classes of subprime mortgages.
Traders therefore consider the ABX to sell or buy exposure to these risks. The ABX is also considered as a barometer / indicator of the collapse of the 2006 -2007 market.