Nvidia stock price tracks Nasdaq Composite Index
The correlation factor between Nvidia and the Nasdaq Composite Index $Nasdaq Composite Index (.IXIC.US)$ is about 0.95, where 1 is perfection correlation, ie each time Nasdaq goes up, Nvidia goes up and vice versa.
Hence if you see the Nasdaq Composite Index rising, 95% of the time Nvidia will rise. The yellow line in the chart is the Nasdaq Composite Index overlayed onto the Nvidia chart.
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I'm just an old dog trying to learn new tricks
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Ultratech : youre just figuring this out now? spy too. . why do you think I hold nvidia. it has the potential to outperform the market.
STD0313 : seeing NVIDIA now makes up a very large % of said index, could it be that the index is following NVIDIA? Almost like apple is to the Dow...
knowledgeisstrength OP Ultratech : I'm posting this for the benefit of noobs who could be already panicking and selling![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
Ultratech knowledgeisstrength OP : me too
knowledgeisstrength OP STD0313 : Nvidia's current weightage in the Nasdaq Composite Index is about 4.72%. I would say it is one of the leaders of the index but by itself Nvidia only influences the index by 4.72% only
STD0313 knowledgeisstrength OP : Right, but what is Nvidia weight in most etfs for AI and Semiconductors......wouldn't that add to its overall weight against the index?
knowledgeisstrength OP STD0313 : I think the Nasdaq Composite Index constituents can only be stocks or ADRs, while ETFs are not stocks and hence cannot qualify to be a constituent of the Index . That said, major ETFs can be quite sizable in their own rights, and some of the tech ETFs do contain a high percentage of Nvidia shares which influences the value of the ETF.