Nasdaq 100 Plans Special Rebalance To Curb Dominance Of 'Magnificent Seven
The Nasdaq 100 index is set to adjust the weighting of its 100 components, with the "magnificent seven" stocks $Microsoft(MSFT.US$ , $Apple(AAPL.US$ , $NVIDIA(NVDA.US$ , $Tesla(TSLA.US$ , $Alphabet-A(GOOGL.US$ , $Meta Platforms(META.US$ and $Amazon(AMZN.US$ currently accounting for more than half the index's weight.
The magnificent seven stocks largely fell Monday.
The Nasdaq 100 special rebalance will take place before the market open on Monday, July 24, to "address overconcentration in the index by redistributing the weights." The Nasdaq has only conducted a special rebalance twice in its history: in December 1998 and May 2011.
The weighting changes will be announced on Friday, July 14. No stocks will be added or removed.
The Nasdaq 100 includes the 100 largest non-financial Nasdaq components.
The magnificent seven stocks largely fell Monday.
The Nasdaq 100 special rebalance will take place before the market open on Monday, July 24, to "address overconcentration in the index by redistributing the weights." The Nasdaq has only conducted a special rebalance twice in its history: in December 1998 and May 2011.
The weighting changes will be announced on Friday, July 14. No stocks will be added or removed.
The Nasdaq 100 includes the 100 largest non-financial Nasdaq components.
Just for reference, for the entire Nasdaq composite, Apple stock had an 11.4% weighting as of July 7 while Microsoft was at 9.5%. GOOGL stock is at 5.8% while Amazon and Nvidia are at 5.1% and 4%, respectively. TSLA stock has 3.3% share and META stock is at 2.8%.
How Much Will Nasdaq 100 Megacaps Be Cut?
Based on Nasdaq 100 methodology, the combined weight of the five companies with the largest market caps will be set to 38.5%. The five-largest companies, Apple, Microsoft, Google, Amazon and Nvidia had a combined weight of 46.7%. That suggests some notable reduced weightings for these names.
Meanwhile, no component outside the top-five market cap companies can have a Nasdaq 100 exceeding the lesser of 4.4% or the weight of the stock with the fifth-largest market valuation. That points to at least a slight decline in TSLA stock's weight.
The official reweightings should be released on Friday, perhaps after the close. That will also include stocks that will see increased weightings.
Based on Nasdaq 100 methodology, the combined weight of the five companies with the largest market caps will be set to 38.5%. The five-largest companies, Apple, Microsoft, Google, Amazon and Nvidia had a combined weight of 46.7%. That suggests some notable reduced weightings for these names.
Meanwhile, no component outside the top-five market cap companies can have a Nasdaq 100 exceeding the lesser of 4.4% or the weight of the stock with the fifth-largest market valuation. That points to at least a slight decline in TSLA stock's weight.
The official reweightings should be released on Friday, perhaps after the close. That will also include stocks that will see increased weightings.
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RDK79 : Or manipulate the non performing stocks back up (and stop short manipulation).
razo2 RDK79 : is about time already. small companies alot missed earnings last Q. but market is rallying based on 7 big companies that barely hit earnings despite lower YoY growth.
JasonDezmal619 : I agree I call mine triangle 3 Microsoft apple and Amazon