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Calculating the Nasdaq indexes daily average

Both the Nasdaq Composite and Nasdaq 100 use the same modified market capitalization weighting method: Each share's closing price (LSP) is multiplied by the total shares outstanding (TSO).

Share weights calculation: Each security's market capitalization is divided by the total capitalization of all index securities. Share weights for each stock are then multiplied by that stock's closing price. The total is divided by an index divisor that accounts for market fluctuations. The result is the Nasdaq average for that day.

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How to invest in Nasdaq stocks

While you can try to duplicate the Nasdaq 100 or the Nasdaq Composite with individual stock purchases, it would be more efficient to invest in an index fund.

  • The Invesco Unit Investment Trust QQQ ETF is the most popular Nasdaq index fund and tracks the Nasdaq 100.
  • Fidelity's...

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Nasdaq facts

Nasdaq is technically a dealer market. Both buyers and sellers trade with a market maker in a specific stock or security.

  • 3,889 listed companies trade on Nasdaq and represent 10 broad sectors or industry groups, mostly in technology, consumer services, and health care.
  • Nasda...

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Nasdaq overview

Nasdaq overview

The Nasdaq (National Association of Securities Dealers Automated Quotations) is the oldest and largest electronic stock market globally. All its buying and selling occurs electronically and not on a physical trading floor.

It is the second-largest stock e...

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History of the Nasdaq

  • The Nasdaq was created in 1971 by the National Association of Securities Dealers (now known as FINRA).
  • At first, it was just a quotation system but began adding trading and transactional systems.
  • In 2002, Nasdaq became an independent, publicly-traded comp...

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Performance of the Nasdaq indexes

Nasdaq's indexes have outperformed the S&P 500 (it tracks large-cap stocks), and the Dow Jones Industrial Index (the 30 largest US companies).

It outperformed because both Nasdaq indexes lean heavily into tech, consumer services, and health care - the top-performing industries in recent ye...

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The Nasdaq has two major indexes

  • The Nasdaq Composite Index tracks 2,790 Nasdaq securities - almost everything except mutual funds, preferred stocks, and derivative securities.
  • The smaller Nasdaq 100 Index focuses on the largest, non-financial companies listed on the Nasdaq with o...

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What Are the Three Major Stock Indexes?

What Are the Three Major Stock Indexes?

The three most widely followed indexes in the U.S. are the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite.

  • The Standard and Poor's 500 Index is an index of 500 large cap common stocks that represent all different sectors of the market.
  • ...

The Nasdaq has two major indexes

  • The Nasdaq Composite Index tracks 2,790 Nasdaq securities - almost everything except mutual funds, preferred stocks, and derivative securities.
  • The smaller Nasdaq 100 Index focuses on the largest, non-financial companies listed on the Nasdaq with o...

Market Value or OMV (Open Market Valuation)

OMV is the price an asset would get in the marketplace, or the value the investment community gives to particular equity or business.

Market value is also used to refer to the market capitalization of a publicly-traded company. It is calculated by multiplying the number of...

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