, Columnist
Worried About Nvidia, Apple and Meta? Nasdaq Has Your Back
The “special rebalance” of the Nasdaq 100 should put to rest hysteria about concentration in high-valuation stocks.
The Magnificent Seven will ride a little more slowly.
Photographer: Victor J. Blue/Bloomberg
This article is for subscribers only.
Everyone can stop all the hand-wringing over the “over-concentration” of the Nasdaq 100: The index provider is doing something about it, as expected, in a sign that the system is working as intended after all.
As Nasdaq announced late last week, it plans to carry out a “special rebalance” on July 24 to redistribute weights after the run-up in megacap stocks. Although the out-of-cycle move was rare and blindsided some investors, it should come as little surprise to those familiar with the index’s methodology.