What is the Nasdaq?
The is two things at once. It is a , a place where shares are bought and sold and it is home to some of the most widely followed indexes in the world, most notably the and the .
What does the track?
The includes virtually every company listed on the exchange, which is over 3,000 . The is more selective it tracks the 100 largest non-financial companies listed on the exchange. When people refer to "the " in financial news, they usually mean the .
Why is it associated with technology?
Because technology companies tend to list on the . Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL), Meta (META), Amazon (AMZN), and Nvidia (NVDA) are all -listed. This gives the index a heavy tilt toward the , which makes it more than the but also capable of stronger gains during periods of tech growth.
How does it differ from the and ?
The is the broadest measure of the American market. is the oldest, the is the most tech-heavy. All three are useful, but they tell slightly different stories about what is happening in the market.
Why does it matter for investors?
If you invest in a -tracking fund, you are making a bet that is disproportionately tied to the . That can work in your favour for long stretches, but it also means sharper drops when tech falls out of favour. Understanding what an index is tilted toward helps you make more informed decisions.