What is the Nasdaq Index? Differences between Nasdaq-100 Index and the Nasdaq Composite Index

BlogJune 22, 2022

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Nasdaq is the world’s second-largest stock exchange by stock value and the world’s first electronic securities trading platform. To better understand what Nasdaq is and the Nasdaq Composite and Nasdaq 100 Index, check out our article below.

What is Nasdaq?

Nasdaq is an acronym for National Association of Securities Dealers Automated Quotations, defined as the American stock exchange. Nasdaq was founded in 1971 by the National Association of Securities Traders. Nasdaq was established to help stock investors through an automated trading system can buy and sell stocks in the most transparent and fastest way.

What is Nasdaq? Types of Nasdaq Indices. Difference between Nasdaq Composite and Nasdaq 100 index to invest in US stocks more effectively

Types of Nasdaq Index

Like any stock exchange, Nasdaq uses a collection of stocks to provide a snapshot of market performance. The NYSE operates the Dow Jones Industrial Average (DJIA) as its primary index, and the NASDAQ uses the Nasdaq Composite and Nasdaq 100.

  1. Nasdaq Composite

The Nasdaq Composite measures the change in more than 3,000 stocks traded on Nasdaq. The Nasdaq Composite is often referred to as the “Nasdaq” and is an index commonly cited by financial journalists and reporters.

Types of securities in the index include:

  • American Certificate of Trust – ADR
  • Common shares
  • The interest rate on capital contribution with limited liability
  • Ordinary shares
  • Real Estate Investment Trusts (REITs)
  • Shares of interest of SBI holders)
  • Tracking Stocks

The index includes all Nasdaq-listed stocks but does not include derivatives, preferred stocks, funds, exchange-traded funds (ETFs), or debt securities.

  1. Nasdaq 100

The Nasdaq 100 measures the 100 largest non-financial companies by market value listed on the Nasdaq exchange. These companies operate across various sectors, although the largest are often technology-related. Each year, companies can be added or removed from the Nasdaq 100, depending on their market value.

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  1. Nasdaq Biotechnology Index and Nasdaq Financial Index

In addition to the two main indexes above, Nasdaq has two other sub-indexes, including the Nasdaq Biotechnology Index (Nasdaq Biotechnology Index) and the Nasdaq Financial Index (Nasdaq Financial 100).

While the Nasdaq Biotechnology Index is a stock market index made up of the securities of Nasdaq-listed companies in the Biotechnology or Pharmaceutical industries, the Nasdaq financial index is an index of financial companies, including banks and insurance, brokerage firms, and mortgage companies.

Difference between Nasdaq Composite Index and Nasdaq 100


Nasdaq Composite

Nasdaq 100
Release time19711985
SizeMore than 3,000 companies are listed on the Nasdaq stock exchangeThe 100 largest companies by market value are trading on the Nasdaq exchange
Evaluation criteriaIt is a company listed exclusively on Nasdaq.

It is one of the following types of securities:

American Certificate of Trust – ADR;
Common shares;

Limited liability capital contribution interest rate;

Ordinary shares

Real Estate Investment Trusts (REITs);

Shares of interest of holders (SBI);

Stock Tracking.
It is a company listed exclusively on Nasdaq.

Publicly offered on the US market for three months;

Have a minimum average daily trading volume of 200,000 shares;

Circulating quarterly and annual reports;

The company is not in danger of bankruptcy or dissolution.
ElementEngineering at 46.40%,

Consumer services at 20.16%,

Healthcare at 10.86%,

Finance at 8.59%,

Industrial at 6.32%,

Consumables at 5.49%,

Petroleum at 0.71%,

Telecommunications at 0.70%,

Base material at 0.47%,

Other utilities at 0.30%.
Technology accounts for 54% of the weight of the index,

Consumer services are represented by companies such as restaurant chains, retailers, and travel services.

Healthcare, industry, and telecommunications.
Some large companies are included in the index1347 Property Insurance Holdings, Inc. 

21 VIA NET GROUP,

2U,

51 JOB,

A-Mark Precious Metals,

AARON,

ABIOMED,

AC Immune Ltd,

AC MOORE ARTS & CRAFTS,

Acacia Communications Inc
Apple,
 
Microsoft,

Amazon,

Facebook,

Alphabet,

Intel Corp,

Comcast Corp,

Cisco Systems,

PepsiCo,

Adobe

Conclusion

Above, we have just provided you with some knowledge about what Nasdaq is and the Nasdaq Composite and Nasdaq 100 indexes and comparing the differences between these two indexes. I hope this sharing will be helpful for you who are active in the field of securities.

* See more: The complete guide Capital.com from a to z

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