NASDAQ
Definition
A global electronic stock exchange known for listing many technology and growth companies, and the index that tracks its performance.
NASDAQ (National Association of Securities Dealers Automated Quotations) is both a stock exchange and a stock market index. As an exchange, it is the second-largest in the world by market capitalization, hosting over 3,000 listed companies. As an index, the NASDAQ Composite tracks all stocks listed on the exchange.
The NASDAQ is heavily weighted toward technology companies, with firms like Apple, Microsoft, Amazon, Alphabet, and Meta making up a significant portion of the index. This tech concentration means the NASDAQ tends to be more volatile but also delivers higher returns during periods of technology sector growth.
The NASDAQ 100 index, which tracks the 100 largest non-financial companies on the exchange, is one of the most widely followed benchmarks and forms the basis of popular ETFs like QQQ. Understanding the NASDAQ's composition helps investors assess their technology exposure.
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Related Terms
Dow Jones Industrial Average
financeA stock market index that tracks 30 large, publicly-owned companies trading on the NYSE and NASDAQ, serving as a benchmark for overall market performance.
S&P 500
financeA stock market index tracking 500 of the largest publicly traded companies in the United States, widely regarded as the best gauge of large-cap U.S. equities.
Market Capitalization
financeThe total market value of a company's outstanding shares of stock, calculated by multiplying share price by total shares outstanding.
Securities
financeTradable financial instruments including stocks, bonds, and options that represent ownership, debt, or the right to buy or sell an underlying asset.
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