NVDA
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Tesla
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Palantir
-- 82.432 RGTI
Rigetti Computing
-- 11.3950 
Nasdaq 100, including Tesla and Meta, lowered weights due to surging stock prices for rebalancing.
Nasdaq 100, Tesla and Meta's weights are lowered due to stock price surge for rebalancing.December 24, 2024 11:42 JST
Measures based on rules to prevent excessive influence of some stocks.
Regulations regarding the reduction of mega-cap stocks are complex and subject to interpretation.
Following the revision of the composition ratio of the USA's Nasdaq 100 index, weights of Tesla, Meta Platforms Inc, and Broadcom were lowered. These technology stocks had inflated market caps due to this year's surge.
The weight changes of these three companies are due to the annual rebalance. Apple, NVIDIA, Microsoft, and Alphabet have expanded their weights, as shown by Bloomberg's data.
This is the second allocation change of the top weighted stocks of the same index in about a year. As the rise of major high-tech stocks that compose the same index attracts market attention and the presence of Artificial Intelligence (AI) increases, there have been movements in rules to prevent excessive influence of some stocks in the index in recent years.
Measures based on rules to prevent excessive influence of some stocks.
Regulations regarding the reduction of mega-cap stocks are complex and subject to interpretation.
Following the revision of the composition ratio of the USA's Nasdaq 100 index, weights of Tesla, Meta Platforms Inc, and Broadcom were lowered. These technology stocks had inflated market caps due to this year's surge.
The weight changes of these three companies are due to the annual rebalance. Apple, NVIDIA, Microsoft, and Alphabet have expanded their weights, as shown by Bloomberg's data.
This is the second allocation change of the top weighted stocks of the same index in about a year. As the rise of major high-tech stocks that compose the same index attracts market attention and the presence of Artificial Intelligence (AI) increases, there have been movements in rules to prevent excessive influence of some stocks in the index in recent years.
The weights of Nasdaq 100 component stocks fundamentally reflect market caps. However, there are rules applied if some stocks become too large. For example, if the total weight of stocks with weights exceeding 4.5% exceeds 48%, adjustments are required. Recently, Broadcom shares surged beyond 4.5%, leading to the same situation again.
The rules regarding the reduction of mega-cap stock weights in the Nasdaq are complex and open to interpretation. This rebalance may have followed rules that allow the weight of the top five stocks to be around 40% and adjust the weights of other stocks.
A Nasdaq spokesperson avoided commenting on the details.
Steve Sosnick, Chief Strategist at Interactive Brokers, commented that it is 'very technical.' 'In a way, Nasdaq 100 has to do this as a price for success. This is because the top stocks are growing dramatically compared to other indexes,' he said.
A Nasdaq spokesperson avoided commenting on the details.
Steve Sosnick, Chief Strategist at Interactive Brokers, commented that it is 'very technical.' 'In a way, Nasdaq 100 has to do this as a price for success. This is because the top stocks are growing dramatically compared to other indexes,' he said.
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