Charted: Companies in the Nasdaq 100, by Weight
Launched in 1985, the Nasdaq 100 index tracks the performance of the largest, and most actively-traded, non-financial companies listed on the Nasdaq stock exchange.
The index is capitalization-weighted, meaning that stock weights in the index are based on each company’s market cap (with some rules to rebalance if companies have an oversized influence). For example, leaders Apple and Microsoft amounted to more than one-fourth of the Nasdaq 100’s total market capitalization alone as of April 2023.
One of the most well-known trackers of the index, Invesco QQQ’s ETF, is the data source for today’s visualization by Truman Du.
Just 7 Companies Dominate the Nasdaq 100
Microsoft and Apple, together with the next five ranked companies, made up over 50% of the total weight of the index in April. These companies are: Alphabet (Google), Amazon, NVIDIA, Meta, and Tesla, with Alphabet’s class A and class C shares occupying two spots.
Here’s a breakdown of all 100 companies on the Nasdaq 100, by percentage weight in the index on April 19, 2023.
|Alphabet (Class A)||3.74%|
|Alphabet (Class C)||3.70%|
|Meta (Class A)||3.68%|
|Comcast (Class A)||1.23%|
|Mondelez International (Class A)||0.74%|
|Automatic Data Processing||0.69%|
|Palo Alto Networks||0.45%|
|ASML Holding NV ADR||0.42%|
|Marriott (Class A)||0.41%|
|Charter Communications (Class A)||0.40%|
|Keurig Dr Pepper||0.38%|
|Airbnb (Class A)||0.38%|
|American Electric Power||0.37%|
|AstraZeneca PLC ADR||0.35%|
|NXP Semiconductors NV||0.34%|
|PDD Holdings Inc ADR||0.32%|
|Workday (Class A)||0.30%|
|Warner Bros. Discovery (Class A)||0.27%|
|Baker Hughes (Class A)||0.24%|
|Cognizant (Class A)||0.24%|
|CrowdStrike Holdings (Class A)||0.22%|
|Atlassian Corp A||0.19%|
|Datadog (Class A)||0.16%|
|Sirius XM Holdings||0.12%|
|Rivian (Class A)||0.09%|
The dominance of these seven companies within the NASDAQ 100 is a reflection of how central they are to large parts of the wider consumer economy. The economic output and influence of the tech giants speaks for themselves, and Tesla still leads the (rapidly crowding) electric vehicle market.
Perhaps the underdog of the bunch is NVIDIA, which produces graphics processing units (GPUs) that power the visuals in many electronic devices and, more recently, artificial intelligence (AI) systems. The latter in particular has made investors incredibly bullish on the company, as NVIDIA’s stock has risen and the company has recently joined the coveted $1 trillion club.
It’s important to note that this snapshot changes drastically over time. For example, Intel and Cisco were massive components of the Nasdaq 100 in the 2000s but have seen their allocations drop, while others like Yahoo! are no longer publicly traded.
The Pros and Cons of Market Consolidation
Such imbalance in the Nasdaq 100 has both benefits and downsides.
The success of the biggest contingents can pull up the entire index, and the Nasdaq 100 has consistently outperformed broader markets. In fact, $10,000 invested in the Nasdaq 100 in 2013 would be worth $50,000 today, while the same investment in the S&P 500 would now be $30,000.
However, if even one of these large companies underperforms, it can have a major impact on the entire index. This outsized influence can also hide general market woes that may be affecting many other components of the index, and the economy.
With the advent of large language models of AI in 2022, the tech sector is on a precipice. Will AI lead to further profitability—and bigger market caps—or will it render entire companies defunct, leading to a big shakeup in the composition of the Nasdaq 100 index?
This article was published as a part of Visual Capitalist's Creator Program, which features data-driven visuals from some of our favorite Creators around the world.
Charted: What are Retail Investors Interested in Buying in 2023?
What key themes and strategies are retail investors looking at for the rest of 2023? Preview: AI is a popular choice.
Charted: Retail Investors’ Top Picks for 2023
U.S. retail investors, enticed by a brief pause in the interest rate cycle, came roaring back in the early summer. But what are their investment priorities for the second half of 2023?
We visualized the data from Public’s 2023 Retail Investor Report, which surveyed 1,005 retail investors on their platform, asking “which investment strategy or themes are you interested in as part of your overall investment strategy?”
Survey respondents ticked all the options that applied to them, thus their response percentages do not sum to 100%.
Where Are Retail Investors Putting Their Money?
By far the most popular strategy for retail investors is dividend investing with 50% of the respondents selecting it as something they’re interested in.
Dividends can help supplement incomes and come with tax benefits (especially for lower income investors or if the dividend is paid out into a tax-deferred account), and can be a popular choice during more inflationary times.
|Investment Strategy||Percent of Respondents|
|Total Stock Market Index||36%|
|Gold & Precious Metals||23%|
Meanwhile, the hype around AI hasn’t faded, with 36% of the respondents saying they’d be interested in investing in the theme—including juggernaut chipmaker Nvidia. This is tied for second place with Total Stock Market Index investing.
Treasury Bills (30%) represent the safety anchoring of the portfolio but the ongoing climate crisis is also on investors’ minds with Renewable Energy (33%) and EVs (27%) scoring fairly high on the interest list.
Commodities and Inflation-Protection stocks on the other hand have fallen out of favor.
Come on Barbie, Let’s Go Party…
Another interesting takeaway pulled from the survey is how conversations about prevailing companies—or the buzz around them—are influencing trades. The platform found that public investors in Mattel increased 6.6 times after the success of the ‘Barbie’ movie.
Bud Light also saw a 1.5x increase in retail investors, despite receiving negative attention from their fans after the company did a beer promotion campaign with trans influencer Dylan Mulvaney.
Given the origin story of a large chunk of American retail investors revolves around GameStop and AMC, these insights aren’t new, but they do reveal a persisting trend.
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