Every December, Nasdaq updates its Nasdaq-100 Index, which features 100 of the largest non-financial companies on the Nasdaq Stock Market. Established in 1985, the index is heavily influenced by the Market capitalizations of its members, including major tech giants like Apple, Microsoft, and Amazon. For December 2023, the index has shown impressive growth, gaining 53.8% in 2023 and 29.4% in 2024. Three new stocks—Palantir, MicroStrategy, and Axon Enterprise—will be added to the index, reflecting their significant Market capitalizations and growth. The Nasdaq-100 serves as a benchmark for investment products like the Invesco QQQ Trust, making it crucial for tracking tech sector performance.
Every December, Nasdaq announces updates to its Nasdaq-100 Index, which tracks the performance of 100 of the largest non-financial companies listed on its exchange. Established in 1985, this index is especially significant for investors as it reflects the Market capitalizations of its component companies, making it a critical gauge of the tech sector’s strength. In 2024, the index has shown remarkable growth, up 29.4% following a staggering 53.8% increase in 2023.
The Nasdaq-100 is widely noticed because it includes major tech giants like Apple, Microsoft, Amazon, and Tesla. With investors closely monitoring these companies, the index serves as a valuable tool for understanding Market trends and company performances.
This year, three stocks are set to join the index on December 23, reflecting their substantial Market capitalizations and impressive year-to-date gains. The new additions are:
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Palantir (PLTR): This Denver-based company focuses on big data analytics software. With a Market capitalization of $173.3 billion and a stunning year-to-date growth of 343%, Palantir’s influence in the tech sector is undeniable.
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MicroStrategy (MSTR): Known for its business intelligence and massive Bitcoin investments, MicroStrategy’s Market cap stands at $97.9 billion, having soared 547% this year.
- Axon Enterprise (AAXN): The Scottsdale, Arizona, firm is famous for its law enforcement technologies, including the Taser. With a Market cap of $49.2 billion, Axon has grown by nearly 150% in 2024.
Meanwhile, three companies will be removed from the index but will still be listed on Nasdaq. These include Illumina, Super Micro Computer, and Moderna, which have faced various challenges this year.
The Nasdaq-100 is also a foundational benchmark for ETFs, particularly the Invesco QQQ Trust, which aims to mirror the index’s performance. As we approach the quadruple witching on December 20—a day that often brings high Market volatility—analysts and investors alike are watching these changes closely, as they can significantly impact Market dynamics.
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Tags: Nasdaq-100, index updates, stock Market news, technology stocks, investing trends.
What are the big changes coming in Nasdaq-100 membership?
The Nasdaq-100 is changing how it selects its members. Starting soon, companies will have to meet stricter requirements to be included in the index. This means they need to have better financial health and more regular trading activity.
Why are these changes being made?
These changes aim to ensure that the Nasdaq-100 features strong and stable companies. By setting higher standards, the goal is to improve the overall quality of the index. This can help attract investors who want to put their money into more reliable stocks.
How will this affect current Nasdaq-100 members?
Some current members might have to make adjustments to stay in the index. If they don’t meet the new criteria, they could be replaced by other companies that do. This could lead to a shift in which stocks are included in the Nasdaq-100.
When will these changes take effect?
The new membership rules for the Nasdaq-100 will be rolled out in the coming months. While the exact date isn’t set yet, companies and investors are encouraged to prepare for the transition soon.
What should investors keep in mind?
Investors should watch for any updates about the Nasdaq-100 changes. It’s important to understand which companies might be added or removed from the index. This can impact investment strategies and overall Market performance. Staying informed will help make better investment decisions.
