Normalized Difference Vegetation Index
Normalized Difference Vegetation Index is one of the oldest Vegetation Indices out there. Most of the Indices around are based from this original NDVI equation. This VI is a robust measure of healthy green vegetation.
The equation uses the highest absorption (Red Light) and reflectance (Green Light) waves of the visual spectrum to calculate the Vegetation Index value. It is a good indicator of chlorophyll content (Greenness) over a wide range of conditions. It can however saturate in dense vegetation conditions when Leaf Area in the survey becomes high.
NDVI= (NIR-Red) / (NIR+Red)
Values range from -1 to 1. Common range for green vegetation is 0.2-0.8
Reference: Rouse, J., R. Haas, J. Schell, and D. Deering. Monitoring Vegetation Systems in the Great Plains with ERTS. Third ERTS Symposium, NASA (1973): 309-317.