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The NASDAQ is an index of the 100 largest non-financial companies listed on the Nasdaq Stock Market. It focuses on the top-performing industries such as technology (54%), consumer services (25%), and healthcare (21%).
This index tracks the performance of the world’s most innovative companies, including Apple, Google, Intel, and Tesla. The NASDAQ is a benchmark primarily for US tech stocks.
Imagine a basket of companies that issue shares. The NASDAQ index tracks changes in their share prices. It’s well-known for its day-to-day volatility, so it attracts traders worldwide.
The NASDAQ-100 index is a modified market capitalization-weighted index. The index value equals the aggregate value of the share weights, also known as the index shares, of each index securities multiplied by each such each security’s last sale price and divided by the index’s divisor.
This weighting limits the influence of the largest companies and balances the index with all members. No company on the Nasdaq-100 can have more than a 24% weighting.
You can trade contracts for difference (CFDs) on the NASDAQ. CFDs reflect the NASDAQ movement. It allows you to trade in both directions. In other words, you can gain from the price going up as well as from it going down. Check contract specifications.
Also, you can use leverage. This means that you can control much bigger financial positions with only a small amount of money. Always remember that leverage allows you to multiply your account. On the downside, you may lose considerably if the market goes against your trades.
The NASDAQ is mainly a technology sector index driven by earnings reports, key appointments, and new product launches. Moreover, US economic factors such as interest rates, monetary policy, and economic indicators can hugely influence the index as they impact company investment rates and consumer appetite for products.