Nasdaq 100 Index

The Nasdaq 100 Index is an index representing the top 100 non-financial companies trading on the Nasdaq Stock Market (Nasdaq). The Nasdaq 100 Index symbol is NDX. At its inception in January 1985, the Nasdaq 100 Index was set at a value of 250. This base value of the Nasdaq 100 Index was changed in January 1994 to a value of 125. The Nasdaq 100 Index is weighted based on a modified market capitalization formula. To compute the Nasdaq 100 Index, Nasdaq computes each stocks index share weight. Nasdaq then multiplies this index share weight by the corresponding stock's last sale price for the day. Nasdaq sums this product for all stocks of the Nasdaq 100 Index and divides this sum by the Nasdaq 100 Index divisor in order to scale down the resulting value of the index which facilitates reporting. The Nasdaq 100 Index includes both US and international companies. Eligibility criteria for inclusion in the Nasdaq 100 index differ between US and International companies but all Nasdaq 100 Index companies must trade at least 200,000 shares per day on Nasdaq. The Nasdaq 100 Index is adjusted quarterly to account for minor changes in the numbers of outstanding shares (i.e. less than 5% change) and to maintain a pre-defined level of diversification between the Nasdaq 100 Index companies. The Nasdaq 100 Index quarterly adjustment is calculated on the first Friday in March, June, September, and December, at the close of trading. The Nasdaq 100 Index quarterly updates become effective on the third Friday in March, June, September, and December, right after the close of trading. In addition to quarterly share updates, the Nasdaq 100 Index is reconstituted annually. The Nasdaq 100 Index annual reconstitution process starts at the beginning of December and company additions and deletions become effective on the third Friday in December, right after the close of trading. Nasdaq can also, at its discretion, decide to add or remove companies from the Nasdaq 100 Index to maintain the continuity of the index.