NASDAQ-100

The NASDAQ-100 (^NDX)[1] is a stock market index made up of 107 equity securities issued by 100 of the largest non-financial companies listed on the NASDAQ. It is a modified capitalization-weighted index. The stocks' weights in the index are based on their market capitalizations, with certain rules capping the influence of the largest components. It is based on exchange, and it is not an index of U.S.-based companies. It does not have any financial companies, since these were put in a separate index. Both of those criteria differentiate it from the Dow Jones Industrial Average, and the exclusion of financial companies distinguishes it from the S&P 500.

History

NASDAQ-100 Index 1985-2015

The NASDAQ-100 began on January 31, 1985 by the NASDAQ, trying to promote itself in the shadow of the New York Stock Exchange. It did so by creating two separate indices: this index, which consists of Industrial, Technology, Retail, Telecommunication, Biotechnology, Health Care, Transportation, Media and Service companies, and the NASDAQ Financial-100, which consists of banking companies, insurance firms, brokerage houses and mortgage companies. By creating these two indices, the NASDAQ hoped that options and futures contracts would be created on them, and mutual funds would adopt them as their benchmarks.

The base price of the index was initially set at 250, but when it closed near 800 on December 31, 1993, the base was reset at 125 the following trading day, leaving the halved NASDAQ-100 price below that of the more commonly known NASDAQ Composite. The first annual adjustments were made in 1993 in advance of options on the index that would trade at the Chicago Board Options Exchange in 1994. Foreign companies were first admitted to the index in January 1998, but had higher standards to meet before they could be added. Those standards were relaxed in 2002, while standards for domestic firms were raised, ensuring that all companies met the same standards. The all-time highs for the index, set at the height of the Dot-Com Bubble in 2000, stand above the 4,700 level, while its recent bear market lows in 2002 revolving around the Early 2000s Recession, the September 11, 2001 Attacks and the subsequent Afghan War occurred below the 900 point level.

After a gradual 5-year recovery to an intraday high of 2,239.51 on October 31, 2007, the highest reached since February 16, 2001, the index corrected below the 2,000 level in early 2008 amid the Late-2000s Recession, the United States Housing Bubble and the Global Financial Crisis of 2008. Panic focusing on the failure of the investment banking industry culminated in a loss of more than 10% on September 29, 2008, subsequently plunging the index firmly into bear market territory. The NASDAQ-100, with much of the broader market, experienced a Limit Down open on October 24 and reached a 6-year intraday low of 1,018 on November 20, 2008.

Amid quantitative easing (QE) from the Federal Reserve and optimism that the financial crisis was ending, the index embarked on a volatile four-year climb higher, closing above 3,000 on May 15, 2013 for the first time since November 15, 2000. By October 18, 2013, with GOOG passing $1,000 per share for the first time, the index had made a closing high of 3,353.88 and intraday high of 3,355.63, its highest levels since the United States elections, 2000 and more than triple the 2008 low. At the close of 2015, the index closed at 4593.27, for a gain of 8.43% on the year.

Investing

The NASDAQ-100 is often abbreviated as NDX in the derivatives markets. Its corresponding futures contracts are traded on the Chicago Mercantile Exchange. The regular futures are denoted by the Reuters Instrument Code ND, and the smaller E-mini version uses the code NQ. Both are among the most heavily traded futures at the exchange.

The PowerShares QQQ exchange-traded fund, sponsored and overseen since March 21, 2007 by Invesco through PowerShares, trades under the ticker NASDAQ: QQQ. It is commonly referred to by its ticker or nickname, the "cubes". It was formerly called NASDAQ-100 Trust Series 1. On December 1, 2004, it was moved from the American Stock Exchange where it had the symbol QQQ to the NASDAQ and given the new four letter code QQQQ, sometimes called the "quad Qs" by traders. On March 23, 2011, Nasdaq changed its symbol back to QQQ.[2]

In 2000, it was the most actively traded security in the United States, and hit an all-time split adjusted intra-day trading high of $120.50 on March 24 of that year, but has since dropped to being within the top five after other stocks and ETFs such as the Standard & Poor's Depositary Receipts. As of August 2012, the fund is the third most actively traded exchange-traded product in the world.[3] On July 17, 2007, the ETF closed above $50 for the first time since early 2001. After reaching a peak of $55.07 on October 31, 2007, the Qs succumbed to a wider financial crisis along with a decline in technology spending and plunged towards a November 21, 2008 intra-day low of $25.05. Since then, it gradually advanced to surpass its 2007 peak, despite some volatility. By October 18, 2013, it had passed and closed above $82 to reach its highest price levels since November 6–7, 2000 and highest value since September 29, 2000 when adjusted for splits and dividends.

Standards

The NASDAQ has over the years put in place a series of stringent standards that companies must meet before being included in the index. Those standards include the following:

Additionally, since 2014, companies with multiple classes of stock are allowed to have multiple classes included in the index, provided they meet NASDAQ's criteria. Prior to 2014, companies were limited to one class of stock in the index(usually the one with the larger market capitalization).

Yearly rebalancing and re-ranking

While the composition of the NASDAQ-100 changes in the case of delisting (such as transferring to another exchange, merging with another company, or declaring bankruptcy, and in a few cases, being delisted by NASDAQ for failing to meet listing requirements), the index is only rebalanced once a year, in December, when NASDAQ reviews its components, compares them with those not in the index, re-ranks all eligible companies and makes the appropriate adjustments.

There are two tools the NASDAQ uses to determine the market values of companies for the annual review:

Those components that are in the top 100 of all eligible companies at the annual review are retained in the index. Those ranked 101 to 125 are retained only if they were in the top 100 of the previous year's annual review. If they fail to move into the top 100 in the following year's review, they are dropped. Those not ranked in the top 125, are dropped regardless of the previous year's rank.

A company will also be dropped if, at the end of two consecutive months, the component fails to have an index weighting of at least one-tenth of a percent. This can occur at any time.

The companies that are dropped are replaced by those who have the largest market value and are not in the index already. Anticipation of these changes can lead to changes in the stock prices of the affected companies.

All changes, regardless of when they occur, are publicly announced via press releases at least five business days before the change is scheduled to take place. The 2016 results of the re-ranking and rebalancing will be announced on December 9 with the changes effective the morning of December 19, coinciding with the expiration of options on December 16.

Differences from NASDAQ Composite index

The NASDAQ-100 is frequently confused with the Nasdaq Composite Index; the latter index (often referred to simply as "The Nasdaq") includes the stock of every company that is listed on NASDAQ (more than 3,000 altogether) and is quoted more frequently than the NASDAQ-100 in popular media.

The NASDAQ-100 is a modified capitalization-weighted index. This particular methodology was created in 1998 in advance of the creation the NASDAQ-100 Index Trust, which holds portions of all NASDAQ-100 firms. The new methodology allowed NASDAQ to reduce the influence of the largest companies and to allow for more diversification. However, the weights of the stocks were not changed after that, which led to more problems. In May 2011, NASDAQ did a major rebalance of the index to bring it closer to market-cap weighting.

The only time the index is to be rebalanced again is if:

Differences from other indices

In addition to its lack of financial companies, the Nasdaq-100 includes 8 companies incorporated outside the United States. Although the S&P 500 Index includes non-U.S. companies, the Dow Jones Industrial Average has never included foreign companies.

As of April 2016, the Nasdaq-100 has companies incorporated in the following foreign countries:

Additionally, the NASDAQ-100 is also the only index of the three that has a regularly scheduled re-ranking of its index each year (in December), ensuring that the largest non-financial companies on NASDAQ are accurately included.

Related indices

In 2006, NASDAQ created a "farm team" index, the NASDAQ Q-50, representing the next fifty stocks in line to enter the NASDAQ-100. With some exceptions, most stocks that are added to the index come up through the Q-50. In 2011, NASDAQ created the NASDAQ-500 to track the 500 largest stocks on NASDAQ, and the NASDAQ-400, tracking those stocks not included in the NASDAQ-100.

NASDAQ has also divided the 100 into two distinct sub-indices; the NASDAQ-100 Tech follows those components who service the tech sector, and the NASDAQ-100 Ex-Tech, which follows those components that are not considered tech companies. The latter index includes noted E-commerce companies Amazon.com and eBay, which are classified as retailers.

Components

This list is current as of the close of trading on April 19, 2016. An up-to-date list is available in the External links section. It should be noted that this is an alphabetical list, and not a ranked list.

  1. 21st Century Fox Class A (FOXA)
  2. 21st Century Fox Class B (FOX)
  3. Activision Blizzard (ATVI)
  4. Adobe Systems Incorporated (ADBE)
  5. Akamai Technologies, Inc (AKAM)
  6. Alexion Pharmaceuticals (ALXN)
  7. Alphabet Inc. Class A (GOOGL)
  8. Alphabet Inc. Class C (GOOG)
  9. Amazon.com, Inc. (AMZN)
  10. American Airlines Group (AAL)
  11. Amgen Inc. (AMGN)
  12. Analog Devices (ADI)
  13. Apple Inc. (AAPL)
  14. Applied Materials, Inc. (AMAT)
  15. Autodesk, Inc. (ADSK)
  16. Automatic Data Processing, Inc. (ADP)
  17. Baidu.com, Inc. (BIDU)
  18. Bed Bath & Beyond Inc. (BBBY)
  19. Biogen, Inc (BIIB)
  20. BioMarin Pharmaceutical, Inc. (BMRN)
  21. Broadcom Limited (AVGO)
  22. CA Technologies (CA)
  23. Celgene Corporation (CELG)
  24. Cerner Corporation (CERN)
  25. Charter Communications, Inc. (CHTR)
  26. Check Point Software Technologies Ltd. (CHKP)
  27. Cisco Systems, Inc. (CSCO)
  28. Citrix Systems, Inc. (CTXS)
  29. Cognizant Technology Solutions Corporation (CTSH)
  30. Comcast Corporation (CMCSA)
  31. Costco Wholesale Corporation (COST)
  32. CSX Corporation (CSX)
  33. CTrip International (CTRP)
  34. Discovery Communications A (DISCA)
  35. Discovery Communications Inc (DISCK)
  36. Dish Network, Inc. (DISH)
  37. Dollar Tree, Inc. (DLTR)
  38. eBay Inc. (EBAY)
  39. Electronic Arts (EA)
  40. Endo International (ENDP)
  41. Expedia, Inc. (EXPE)
  42. Express Scripts, Inc. (ESRX)
  43. Facebook, Inc. (FB)
  44. Fastenal Company (FAST)
  45. Fiserv, Inc. (FISV)
  46. Gilead Sciences, Inc. (GILD)
  47. Henry Schein, Inc. (HSIC)
  48. Illumina, Inc. (ILMN)
  49. Incyte Corporation (INCY)
  50. Intel Corporation (INTC)
  51. Intuit, Inc. (INTU)
  52. Intuitive Surgical Inc. (ISRG)
  53. JD.com (JD)
  54. Kraft Heinz Company (KHC)
  55. Lam Research, Inc. (LRCX)
  56. Liberty Braves Common Stock (BATRA)
  57. Liberty Braves (BATRK)
  58. Liberty Global plc Ordinary A (LBTYA)
  59. Liberty Global plc Ordinary C (LBTYK)
  60. Liberty Interactive (QVCA)
  61. Liberty Media C (LMCK)
  62. Liberty Media Series A (LMCA)
  63. Liberty Ventures (LVNTA)
  64. Linear Technology Corporation (LLTC)
  65. Marriott International, Inc. (MAR)
  66. Mattel, Inc. (MAT)
  67. Maxim Integrated Products (MXIM)
  68. Micron Technology, Inc. (MU)
  69. Microsoft Corporation (MSFT)
  70. Mondelēz International (MDLZ)
  71. Monster Beverage (MNST)
  72. Mylan, Inc. (MYL)
  73. NetApp, Inc. (NTAP)
  74. NetEase, Inc. (NTES)
  75. Netflix (NFLX)
  76. Norwegian Cruise Line Holdings (NCLH)
  77. NVIDIA Corporation (NVDA)
  78. NXP Semiconductors (NXPI)
  79. O'Reilly Automotive, Inc. (ORLY)
  80. PACCAR Inc. (PCAR)
  81. PayPal Holdings, Inc. (PYPL)
  82. Paychex, Inc. (PAYX)
  83. QUALCOMM Incorporated (QCOM)
  84. Regeneron Pharmaceuticals (REGN)
  85. Ross Stores Inc. (ROST)
  86. SBA Communications (SBAC)
  87. Seagate Technology Holdings (STX)
  88. Sirius XM Radio, Inc. (SIRI)
  89. Skyworks Solutions, Inc. (SWKS)
  90. Starbucks Corporation (SBUX)
  91. Stericycle, Inc (SRCL)
  92. Symantec Corporation (SYMC)
  93. Tesla Motors, Inc. (TSLA)
  94. Texas Instruments, Inc. (TXN)
  95. The Priceline Group (PCLN)
  96. T-Mobile US (TMUS)
  97. Tractor Supply Company (TSCO)
  98. TripAdvisor (TRIP)
  99. Ulta Beauty (ULTA)
  100. Verisk Analytics (VRSK)
  101. Vertex Pharmaceuticals (VRTX)
  102. Viacom Inc. (VIAB)
  103. Vodafone Group, plc. (VOD)
  104. Walgreens Boots Alliance (WBA)
  105. Western Digital (WDC)
  106. Whole Foods Market, Inc. (WFM)
  107. Xilinx, Inc. (XLNX)
  108. Yahoo! Inc. (YHOO)

Historical components

As of March 2016, 459 companies have been components of the index. Of these, only four, Apple, Costco (through its merger in 1993 with Price Club(Costco, as a separate entity, did not become a component until a few years later)), Intel and PACCAR, have been components, continuously, since the first dissemination of the index in 1985. Two other companies, Micron Technology and Seagate were also components when the index started, but were removed from the index over time for various reasons.[4]

Yearly changes

Changes in 2008

On April 30, 2008 The DirecTV Group (DTV) replaced BEA Systems (BEAS) before the market open.

On May 19, 2008 CA, Inc. (CA) replaced Tellabs (TLAB) before the market open.

On July 21, 2008 FLIR Systems (FLIR) replaced UAL Corporation (UAUA) before the market open.

On November 10, 2008 Seagate Technology (STX) replaced Monster Worldwide (previously MNST, but changed ticker to MWW on November 10, 2008) before the market open.

On December 22, 2008, NASDAQ added the following companies to the NASDAQ-100 index prior to the market open: Automatic Data Processing, First Solar, Life Technologies, Ross Stores Inc., Maxim Integrated Products, Illumina, Inc., Pharmaceutical Product Development, O'Reilly Automotive, Urban Outfitters, J. B. Hunt Transport Services, and Warner Chilcott. The companies that were replaced are: Amylin Pharmaceuticals, Cadence Design Systems, Discovery Communications, Lamar Advertising Company, Leap Wireless International, Level 3 Communications, PetSmart, SanDisk, Sirius XM Radio, Virgin Media, and Whole Foods Market.

Changes in 2009

On January 20, 2009, News Corporation was added to the index, replacing Focus Media Holding, which did not meet the minimum monthly weight requirements.

On July 17, 2009, Cerner Corporation replaced Sun Microsystems after Sun Microsystems was acquired by Oracle.

On October 29, 2009, Priceline.com replaced Juniper Networks, after Juniper transferred to the NYSE.

On December 21, 2009, seven stocks joined the NASDAQ-100 index before the market open: Vodafone, Mattel, BMC Software, Mylan, Qiagen, SanDisk and Virgin Media. These stocks replaced Akamai Technologies, Hansen Natural, IAC/InterActiveCorp, Liberty Global, Pharmaceutical Product Development, Ryanair and Steel Dynamics.

Changes in 2010

On December 20, 2010, seven companies were added to the NASDAQ-100 index prior to the market open: F5 Networks, Akamai Technologies, Netflix, Micron Technology, Whole Foods Market, Ctrip.com International and Dollar Tree. They replaced Cintas, Dish Network, Foster Wheeler. Hologic, J. B. Hunt, Logitech and Patterson Companies. These were the only changes made to the index that year and the fewest since 1997.

Changes in 2011

On April 4, 2011, Alexion Pharmaceuticals (ALXN) replaced Genzyme (GENZ) before the market open. Genzyme was purchased by Sanofi-Aventis.

On May 6, 2011, WFMI (Whole Foods Market) changed its ticker symbol to WFM prior to the market open.

On May 27, 2011, Green Mountain Coffee Roasters (GMCR) replaced Millicom International Cellular prior to the market opening after Millicom (MICC) withdrew its NASDAQ listing.[5]

On July 15, 2011, Sirius XM Radio (SIRI) replaced Cephalon (CEPH) in the index.[6] Cephalon was acquired by Teva Pharmaceutical Industries.

On December 6, 2011, Perrigo (PRGO) joined the index.[7] The company replaced Joy Global (JOYG), who transferred their stock listing to the NYSE. Perrigo had been a member of the index in the 1990s, being dropped in 1996.[8]

On December 19, 2011, five companies joined the NASDAQ-100 index prior to the market open as a result of NASDAQ's annual reranking of the index. They are Avago Technologies (AVGO), Fossil, Inc. (FOSL), Monster Beverage (MNST, formerly known as Hansen Natural, ticker symbol HANS), Nuance Communications (NUAN), and Randgold Resources (GOLD). These companies replaced FLIR Systems (FLIR), Illumina (ILMN), NII Holdings (NIHD), Qiagen (QGEN), and Urban Outfitters (URBN).

On December 20, 2011, ERTS (Electronic Arts) changed its ticker symbol to EA prior to the market open.[9]

Changes in 2012

On January 9, 2012, HANS changed its ticker symbol to MNST (Monster Beverage) prior to the market open.

On April 23, 2012, Texas Instruments (TXN) replaced First Solar (FSLR) prior to the market open.

On May 30, 2012, Viacom (VIAB) became a component of the index prior to the market open. It replaced Teva Pharmaceutical Industries (TEVA), which transferred to the NYSE.

On July 23, 2012, Kraft Foods, Inc. (KFT), now known as Mondelez (MDLZ), became a component of the index prior to the market open, replacing Ctrip (CTRP). Kraft Foods was the fourth component of the NASDAQ-100 to also be included in the Dow Jones Industrial Average, joining Cisco Systems, Intel, and Microsoft, but was removed from the DJIA when it subsequently split into two companies.

On Wednesday December 12, 2012, Facebook Inc. (FB) became part of the NASDAQ-100 Index prior to the market open, replacing Infosys Limited (INFY), which transferred its listing to the NYSE.

Prior to the market open on Monday, December 24, 2012, 20 changes to the index took place. The ten companies joining the index are:

The ten companies being dropped are:

Changes in 2013

On January 15, 2013, Starz Inc. (STRZA) replaced Liberty Media (LMCA) after a spinoff.

On March 18, 2013, Kraft Foods Group Inc. (KRFT) replaced Starz Inc. (STRZA).[10]

On June 5, 2013, Liberty Media (LMCA) replaced Virgin Media (VMED) with whom it merged.

On June 6, 2013, Netflix (NFLX) replaced Perrigo (PRGO) who had transferred to the NYSE.

On July 15, 2013, Tesla Motors (TSLA) replaced Oracle Corporation (ORCL), which transferred to the NYSE.

On July 25, Charter Communications (CHTR) replaced BMC Software (BMC) which eventually went private.

On August 22, Green Mountain Coffee Roasters (GMCR) returned to the index, replacing Life Technologies (LIFE); Life Technologies announced its takeover by ThermoFisher.[11]

On October 29, VimpelCom Ltd. (VIP) replaced DELL (DELL) which eventually went private.

On November 18, Marriott International (MAR) was added to the index, replacing Randgold Resources (GOLD).

Prior to the market open on Monday, December 23, 2013, 10 changes to the index took place. The five companies joining the index were:[12]

The five companies that were dropped were:

Changes in 2014

Prior to the market open on Thursday, April 3, 2014, the Class C common Stock of Google, Inc. was added to the index as a result of Google's stock split. This meant the index had 101 components.

Later in 2014 additional classes of stock from other index companies were added to the index, bringing the number of constituent securities in the index to 107.

On December 12, NASDAQ announced that American Airlines Group, Electronic Arts, and Lam Research would be added to the index, effective December 22. These companies would replace Expedia, F5 Networks, and Maxim Integrated Products.

Changes in 2015

On March 23, Walgreens Boots Alliance replaced Equinix in the index. Equinix converted into a REIT, making it ineligible for inclusion in the NASDAQ-100, but it did gain eligibility for the NASDAQ Financial-100, which it did join a few weeks later. Also on March 23, Biogen Idec renamed itself Biogen, as a result of a shift in focus.

On July 1, Liberty Interactive created two new tracking stocks, tracking the company's interests in Latin America. Both tracking stocks were added to the index the same day.

On July 2, Kraft Foods and Heinz completed their merger, becoming the Kraft Heinz Company with the symbol KHC.

Catamaran Corporation was removed from the index after the close of trading on July 23 after going private. JD.com replaced it on July 29.

DirecTV was removed from the index on July 24. It was replaced by BioMarin Pharmaceutical on July 27.

Sigma-Aldrich was removed on July 31, after being acquired by German firm Merck KGaA. Skyworks Solutions took Sigma-Aldrich's place at the start of trading August 3.

Altera was removed on October 7 as a result of its merger with Intel. Incyte replaced Altera's on that date. [13]

PayPal Holdings was added to the index on November 11, as Broadcom is in the process of merging with Avago Technologies.

Comcast Corporation on December 15 converted their Special Class A shares to regular Class A shares, leaving it with just a single class of stock.

NASDAQ announced on December 11 that seven companies will be added to the index on the 21st. They are:

These Companies will replace:

In addition, the two Liberty Interactive LILAC tracking stocks were removed from the index, leaving 106 separate components.[14]

Changes in 2016

On February 1, Avago Technologies changed its name to Broadcom Limited after completing its merger with the former Broadcom.

On February 22, CSX Corporation replaced KLA-Tencor as a member of the index.[15] KLA-Tencor is merging with Lam Research.

On March 16, NetEase replaced SanDisk as a member of the index. SanDisk is in the process of merging with Western Digital.

On April 18, Liberty Media established two tracking stocks to follow the performance of its investment in the Atlanta Braves.

References

  1. ↑ "NASDAQ-100". Yahoo! Finance. Retrieved 9 February 2016.
  2. ↑ "Q: Why Did QQQQ drop a Q to Become QQQ?".
  3. ↑ ETP Landscape Industry Highlights BlackRock
  4. ↑ "The Nasdaq-100 Turns 30: Tracking Innovation in Large Cap Growth".
  5. ↑ "Millicom International Cellular: To Consolidate Its Listing on NASDAQ OMX Stockholm". Business Wire. 19 April 2011. Retrieved 9 February 2016.
  6. ↑ Newsroom
  7. ↑ "NASDAQ Newsroom". Nasdaq.com. Retrieved 2013-04-02.
  8. ↑ "Historical Data – NASDAQ-100 Index". Nasdaq.com. Retrieved 2013-04-02.
  9. ↑ "Electronic Arts to Change Nasdaq Ticker Symbol to "EA" Effective December 20, 2011 (NASDAQ:EA)". Investor.ea.com. Retrieved 2013-04-02.
  10. ↑ "Kraft Foods Group to Join Nasdaq 100". Fox Business. 2013-03-08. Retrieved 2013-04-02.
  11. ↑ http://www.nasdaqomx.com/newsroom/pressreleases/pressrelease?messageId=1201917&displayLanguage=en
  12. ↑ http://globenewswire.com/news-release/2013/12/14/596871/10061456/en/Annual-Changes-to-the-NASDAQ-100-Index.html
  13. ↑ "Incyte Corporation to Join Nasdaq-100 Index on October 7, 2015". Yahoo! Finance. Retrieved 30 September 2015.
  14. ↑ http://www.nasdaq.com/press-release/annual-changes-to-the-nasdaq100-index-20151211-00657
  15. ↑ "CSX Corporation to Join the NASDAQ-100 Index on February 22, 2016". Yahoo! Finance. Retrieved 13 February 2016.

External links

This article is issued from Wikipedia - version of the Saturday, April 23, 2016. The text is available under the Creative Commons Attribution/Share Alike but additional terms may apply for the media files.