The Nasdaq Composite Index is a stock market index comprising 2,658 stocks representing the global Nasdaq market. Stocks entering the index must meet strict corporate governance standards and financial liquidity requirements. The Nasdaq Composite Global Index, mostly known as the Nasdaq Composite, is less exclusive than the Nasdaq Composite Select Index.
Understanding the Nasdaq Composite
The Nasdaq Global Composite Stock Market Index was established by NASDAQ in 2006, when the Nasdaq National Market was divided into two units: The Nasdaq Global Market and the Nasdaq Global Select Market. This index focuses on companies that are not strong enough to be included in the Nasdaq Composite Select Global Market. The Composite Global Market is less exclusive than the Composite Global Select Market.
This change for Nasdaq was nominal, as it did not affect company listing standards or alter corporate governance standards or financial liquidity requirements. The Nasdaq division was designed to reflect the global reach of the index and the companies that were listed on it.
Nasdaq divisions
The Nasdaq Market has three distinct divisions: The Nasdaq Global Select Market, the Nasdaq Global Market, and the Nasdaq Capital Market.
The requirements for entering the Nasdaq Global Select Market are the most stringent of all, and the requirements for the Nasdaq Global Market are more stringent than those for the Nasdaq Capital Market.
Corporate governance requirements are the same across all Nasdaq divisions. All companies listed on the Nasdaq Market must meet a variety of financial, corporate governance, and liquidity requirements, and while a company’s assets may qualify for listing initially, Nasdaq may deny listing when necessary. , this in order to protect the interests of investors and the public.
The performance of all Nasdaq divisions is based on market capitalization weight. As a result of this, the movement of the common stocks of the largest companies has a larger impact on the movement of each index as a whole.
Nasdaq Composite Index
Unlike other market indices, the Nasdaq Composite is not limited to companies based in the United States, but is made up of a variety of companies with global reach in sectors such as technology, finance, information technology, insurance and telecommunications. This index seeks to measure the movements of the most representative companies on the Nasdaq Stock Exchange (National Association of Securities Dealers Automated Quotation), which is the most important electronic stock exchange in the world.
“Today, Nasdaq companies cover the entire spectrum of the United States economy. From industrial companies to transportation, with a strong representation of the computer and information technology world. Many well-known North American companies choose Nasdaq, including: Adobe Systems, Amazon.com, Microsoft, Cisco, Dell Computer Corporation, Intel Corporation and Yahoo.”
Nasdaq Composite calculation methodology
The index gives a greater value or weight to companies that have a greater market capitalization, so these will have a greater representation in the total market value of this index. Then the market value is adjusted by means of a divisor, which seeks to scale the value of the prices to have a general measure of the value of the shares listed on the Nasdaq Global Market and their rise or fall.
Along with the Dow Jones Index and the S&P 50 0, the Nasdaq Composite is one of the most watched indices in the world and provides a broad look at multiple companies in the technology market.
At the time of this report, the Nasdaq index reached 8434.52 points, breaking a historical record on the rise, driven mainly by expectations that trade between the United States and China may be normalized throughout 2020 and by the good results of companies. American technology companies.
Representative companies of this index:
Some of the most recognized companies worldwide that are listed on the Nasdaq market and are weighted in this index are: Alphabet (Google’s parent company), Amazon, Apple, Beyond Meat, Cisco, Comcast, Del Taco Restaurants, Discovery Inc, Dropbox, eBay, Etsy Inc., Facebook, Fox, Icahn Enterprises, Marriott Inc, MongoDB, Microsoft, Nasdaq Inc, News Corp, Netflix, Pepsi, Qualcomm, Tesla, TripAdvisor, Wix.com, Yandex,
