Market value-weighted index

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Market value-weighted index

An index of a group of securities computed by calculating a weighted average of the returns on each security in the index, where the weights are proportional to outstanding market value.

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 ?
The new market-value weighted benchmark is introduced as a comprehensive addition to the widely used J.
04 for the equally-weighted portfolios whereas it is slightly higher for market-value weighted portfolios.
As a market-value weighted index, each stock's weight in the overall index is proportionate to its market value (i.
The Markit iBoxx[R] $ Liquid High Yield Index is a modified market-value weighted index designed to provide a balanced representation of U.
The Markit iBoxx $ Liquid Investment Grade Index is a modified market-value weighted index designed to provide a balanced representation of U.
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.
S&P Midcap 400 Index: An index of 400 mid-size domestic equity company stocks in various industries; it is a market-value weighted index.
It is a market-value weighted index (stock price times the number of shares outstanding), with each stock's weight in the Index proportionate to its market value.
It is a market-value weighted index with each stock's weight in the Index proportionate to its market value.
The S&P SmallCap 600 Index is a market-value weighted index and consists of 600 domestic stocks chosen on the basis of market capitalization, liquidity and industry group representation.
The S& SmallCap 600 is a market-value weighted index, calculated as the stock price times the number of shares outstanding, with each stock's weight in the Index proportionate to its market value.