Capitalization-Weighted Index

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Capitalization-Weighted Index

A stock index which is computed by adding the capitalization (float times price) of each individual stock in the index, and then dividing by the divisor. The stocks with the largest market values have the heaviest weighting in the index. See also Float, Divisor.

Capitalization-Weighted Index

An index in which the price is determined by the price of individual stocks, weighted for total market value. For example, if the price of a component stock of the index changes, its effect on the index as a whole is proportionate to share's price multiplied by the number of shares the company has outstanding. This means that changes in price will affect the index more if the component company has greater value. Most non-American market value-weighted indices give further weighting (called float-weighted indexing) to properly account for partial government ownership of many large corporations. This method of index weighting contrasts with a price-weighted index, in which all price changes are weighted differently, and a market share-weighted index, which weights only by the number of shares outstanding and not by their value. Major examples of a market value-weighted index include the NASDAQ Composite Index and the Standard & Poor's 500. The latter uses float-weighted indexing to match its calculations more closely with foreign counterparts.
References in periodicals archive ?
From July 1, 2009, the new benchmark will offer investors a rules-based market value weighted index as a complementary alternative to the flagship US Aggregate Index, which includes agencies and MBS held in government accounts.
CND will be a market value weighted index and will be displayed on the newly launched www.
The NASDAQ Health Care Index is a market value weighted index that contains NASDAQ-listed companies classified, according to the FTSE(TM) Global Classification System, as "Health," "Pharmaceutical" or "Biotechnology.
The index is a market value weighted index designed to replicate the price movements of medium-duration bonds.
The NASDAQ Health Care Index is a market value weighted index that contains NASDAQ-listed companies classified, according to the FTSE Global Classification System, as "Health," "Pharmaceutical" or "Biotechnology.
Designed to provide an alternative to market value weighted index strategies, the SPDR Barclays Capital Issuer Scored Corporate Bond ETF (Symbol: CBND) seeks to track the performance of the Barclays Capital Issuer Scored Corporate Index.
The NASDAQ Health Care Index is a market value weighted index that contains NASDAQ listed companies classified, according to the FTSETM Global Classification System, as "Health," "Pharmaceutical" or "Biotechnology.
It is a market value weighted Index (stock price times number of shares outstanding), with each stock's weight in the Index proportionate to its market value.
The NASDAQ Health Care Index is a market value weighted index that contains NASDAQ-listed companies which are classified according to the FTSE Global Classification System, as "Health," "Pharmaceutical" or "Biotechnology.
The NASDAQ Health Care Index is a market value weighted index that contains 542 NASDAQ-listed companies which are classified by the FTSE Global Classification System as "Health," "Pharmaceutical" or "Biotechnology.
The NASDAQ Health Care Index is a market value weighted index that contains NASDAQ listed companies classified, according to the FTSE(TM) Global Classification System, as "Health," "Pharmaceutical" or "Biotechnology.