What do people mean when they say 'benchmark' and what does it mean to 'beat the market'? ?

It is referring to an index which investors use to compare with their investment. Examples are S&P500, MSCI all countryindex, Nasdaq, STI. Choosing the correct index is extremely important. For investors who invest in a variety of stocks in the US, he/she should use S&P500. For investors who invest solely in SG, he/she should use STI. For investors who diversify their investment worldwide, he/she should use MSCI all country. If the investor only invests in a sector, then he will have to find a suitable sector index.​​​

Hi!

A benchmark is basically a reference point to compare the returns from an investment. The S&P500, Dow Jones etc. are indices which are used as to understand the market returns and see the trends prevalent in the market. A good benchmark is usually provides a fair understanding of the market.
Benchmark is thus used as the base level of return. Beating the market thus means earning a return higher than the benchmark. For this, choosing the correct benchmark is also important so that an accurate comparison can be made.
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