A modified capitalization-weighted index that includes
the largest non-financial U.S. and non-U.S. companies listed on the NASDAQ
stock market across a variety of industry groups, such as retail, healthcare,
telecommunications, wholesale trade, biotechnology, and technology. The index
is designed to limit the influence of a few large stocks. To be included in the
index, companies must meet some general guidelines: Companies listed in the
NASDAQ 100 have been publicly traded for two years, are listed on the NASDAQ
National Market (made up of the largest stocks), and have an average daily
trading volume of at least 200,000 shares. Companies must not be in bankruptcy
or involved in a potential merger transaction. NASDAQ reviews the companies in
the index quarterly in order to adjust the weightings. The NASDAQ 100 began in
January 1985.
An exchange-traded
fund (ETF), QQQ, tracks the NASDAQ-100 Index. It allows large investors to buy
or sell shares in the collective performance of the NASDAQ 100 Index in a
single transaction as if purchasing or trading just one stock. QQQ trades on
the American Stock Exchange and is one of the most actively traded ETFs.