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NASDAQ 100 Overview.
The
Nasdaq 100 Index includes 100 of the largest
domestic and international non-financial companies listed on The Nasdaq
Stock Market based on market capitalization. The Index reflects
companies across major industry groups including computer hardware and
software, telecommunications, retail/wholesale trade and biotechnology.
It does not contain financial companies including investment companies.
Launched in January 1985, the Nasdaq 100 Index represents the largest
non-financial domestic and international issues listed on The Nasdaq
Stock Market based on market capitalization. The Nasdaq 100 Index is
calculated under a modified capitalization-weighted methodology. The
methodology is expected to retain in general the economic attributes of
capitalization-weighting while providing enhanced diversification. To
accomplish this, Nasdaq will review the composition of the Nasdaq 100
Index on a quarterly basis and adjust the weightings of Index components
using a proprietary algorithm, if certain pre-established weight
distribution requirements are not met.
The number of securities in the Nasdaq 100 Index makes it an
effective vehicle for investors. In January 1994, options on the Nasdaq
100 Index began trading on the Chicago Board Options Exchange. The
Chicago Mercantile Exchange began to trade futures and futures options
on the Nasdaq 100 Index in April of 1996. Nasdaq 100 Index Tracking
Stock (QQQQ) began trading on the American Stock Exchange in March 1999.
In addition, the Index is used as a benchmark for financial products in
many countries around the world.
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