Market value-weighted index

(redirected from Capitalization-weighted)

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 ?
It is a proprietary, rules-based, modified market capitalization-weighted, float-adjusted index comprised of companies that are materially engaged in the cloud infrastructure industry, including cloud systems/services, cloud management software, cloud hosting, cloud security, cloud hardware and cloud data centers.
Investing in the S&P 500 via a passive (capitalization-weighted index) product is a common strategy that is appealing to many investors.
Being capitalization-weighted, the index reflects the performance of the most representative companies in the global emerging markets (including China A Shares).
The BGCI is market capitalization-weighted and measures the performance of ten USD-traded cryptocurrencies, including Bitcoin, Ethereum, Monero, Ripple, and Zcash.
"Considering the fact that a capitalization-weighted index or equal-weighted index is a type of market index with individual components that are weighted according to their total market capitalization, it becomes clear that the large price moves in commodity-driven companies, the largest components of the TSE, had a significant effect on the value of the index"
The NASDAQ biotechnology Index is calculated under a modified capitalization-weighted methodology.
The TOPIX is a free-float adjusted market capitalization-weighted index that is calculated based on all common stocks listed on the First Section of Tokyo Stock Exchange, the cash market of JPX, and is widely used as a benchmark by institutional investors in Japan.
The capped, float-adjusted, capitalization-weighted index, whose constituents are engaged in midstream activities involving energy commodities, is disseminated real-time on a price-return basis and on a total-return basis (AMEIX).
MSCI China A International with CNH 100% Hedged to USD Index: It is a free float-adjusted market capitalization-weighted index compiled and published by MSCI Inc.
The series is capitalization-weighted, and covers the period from 1/ 1985 thru 1/2005.
At its core, smart beta departs from capitalization-weighted market indexes to construct portfolios that are fundamentally different.
To ascertain a 1 consistent return computation methodology across the countries, we adopt MSCI indices which are widely tracked capitalization-weighted global equity benchmarks and additionally serve as the basis for numerous futures contracts and over 650 exchanged traded funds (ETFs) throughout the world1.