# Nasdaq Composite
The Nasdaq Composite is a market capitalization-weighted stock market index that measures essentially all common-type stocks listed on the Nasdaq Stock Market, launched on February 5, 1971 at a base value of 100.[1](https://beta.indexes.nasdaq.com/docs/methodology_COMP.pdf) • [2](https://fred.stlouisfed.org/series/NASDAQCOM) With more than 2,500 companies, it covers more constituents than most other stock market indexes.[3](https://indexes.nasdaq.com/Index/Overview/COMP)
| Key fact | Detail |
|---|---|
| Launch | February 5, 1971, base value 100.00; current divisor 1,751,370,285[2](https://fred.stlouisfed.org/series/NASDAQCOM) • [3](https://indexes.nasdaq.com/Index/Overview/COMP) |
| Constituents | 3,391 components on the live overview page; official text says "over 2,500 companies"[3](https://indexes.nasdaq.com/Index/Overview/COMP) |
| Weighting | Market capitalization: last sale price times total shares outstanding, divided by aggregate index market cap, adjusted by an index divisor[4](https://indexes.nasdaqomx.com/docs/Nasdaq_Index_Weight_Calculations.pdf) • [5](https://www.investopedia.com/terms/n/nasdaqcompositeindex.asp) |
| Concentration | Top 10 holdings about 53.3% of index weight midway through 2026; Technology sector 65.77% as of September 30, 2026[6](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-performance-september-2026) • [7](https://indexes.nasdaq.com/docs/FS_COMP.pdf) |
| Recent returns | 2022: -33.10%; 2023: +43.42%; 2024: +28.64%; 2025: +20.36%[7](https://indexes.nasdaq.com/docs/FS_COMP.pdf) |
| Rebalancing | Reconstituted daily; ineligible securities removed daily and never replaced[1](https://beta.indexes.nasdaq.com/docs/methodology_COMP.pdf) |
| Investable proxies | Fidelity Nasdaq Composite Index ETF (ONEQ), 0.21% expense ratio, statistical sampling; FNCMX mutual fund[8](https://www.nasdaq.com/articles/what-is-the-nasdaq-composite-and-what-companies-are-in-it-2021-05-12) |
## How the index is constructed
The Composite is a [capitalization-weighted index](https://www.edgepedia.org/capitalization-weighted-index): each security's weight is its last sale price multiplied by its total shares outstanding, divided by the aggregate market capitalization of all index securities.[4](https://indexes.nasdaqomx.com/docs/Nasdaq_Index_Weight_Calculations.pdf) A divisor keeps the index continuous across corporate actions such as stock splits and spinoffs; the current divisor is 1,751,370,285.[9](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-vs-dow-key-differences-to-know) • [3](https://indexes.nasdaq.com/Index/Overview/COMP)
Eligibility is broad. A security must be listed exclusively on the Nasdaq Stock Exchange and must have traded at least one day with a Nasdaq Official Closing Price; eligible types include common stocks, ADRs, ordinary shares, limited partnership interests, and shares or units of beneficial interest. Closed-end funds, ETFs, preferred stocks, rights, warrants, and other derivative securities are excluded.[1](https://beta.indexes.nasdaq.com/docs/methodology_COMP.pdf) New listings enter on their second day of trading, weighted by total listed market capitalization with no float adjustment, no concentration caps, and no limit on any single company's influence.[10](https://www.nasdaq.com/newsroom/nasdaq-composite-vs-nasdaq-100-what-investors-should-know)
Reconstitution happens every day, not on a quarterly or annual schedule: all securities meeting the eligibility criteria are added, securities that are no longer eligible are removed daily, and index securities are not replaced. A delisted or acquired company simply leaves the index.[1](https://beta.indexes.nasdaq.com/docs/methodology_COMP.pdf)
## Composition and concentration
The index's defining feature is concentration in a small number of very large companies. Out of about 2,500 components, the top 100, representing four percent of the components, have made up more than two-thirds of the index value, a share that has been creeping upward.[11](https://beta.indexes.nasdaq.com/docs/COMP_Research.pdf) The largest single issue has consistently represented about 10% of index value; Microsoft was the largest company every year except 2000 (Cisco) before Apple's rise at the end of 2010.[11](https://beta.indexes.nasdaq.com/docs/COMP_Research.pdf)
As of September 30, 2026, the top 10 components by weight were NVIDIA (11.68%), Apple (10.31%), Microsoft (8.08%), Amazon (5.70%), Alphabet Class A (4.28%), Alphabet Class C (4.00%), Broadcom (3.54%), Meta (3.39%), Tesla (2.97%), and Space Exploration Technologies (2.62%). Technology was the largest industry at 65.77%, followed by Consumer Discretionary at 15.04% and Health Care at 5.24%.[7](https://indexes.nasdaq.com/docs/FS_COMP.pdf) Midway through 2026 the top 10 accounted for about 53.3% of the index, against financials at 2.77% and energy at 0.60%.[6](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-performance-september-2026)
This concentration is a live academic concern. Research on cap-weighted indexes notes increased concern that such indexes may suffer from overly concentrated positions in a few securities, and defines concentration metrics to track the phenomenon over time.[12](https://escholarship.org/content/qt3kc7174f/qt3kc7174f_noSplash_d124b0c056829f822824173302a03170.pdf) The practical consequence is that the Composite and the [Nasdaq-100](https://www.edgepedia.org/nasdaq-100), which holds the same mega-caps, historically move in similar directions.[10](https://www.nasdaq.com/newsroom/nasdaq-composite-vs-nasdaq-100-what-investors-should-know)
## History: from 1971 to the dot-com crash and recoveries
The index crossed 1,000 before the dot-com bubble.[9](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-vs-dow-key-differences-to-know) From 1995 to 2000 it rose more than 400%, then declined roughly 78% between 2000 and 2003 after the bubble burst.[13](https://www.investopedia.com/nasdaq-vs-sp500-vs-dow-5213252) It first crossed 6,000 on April 25, 2017, having outperformed the [S&P 500](https://www.edgepedia.org/s-and-p-500) in seven of the prior 10 calendar years, cumulatively by more than 80% from end-2006 through April 24, 2017.[11](https://beta.indexes.nasdaq.com/docs/COMP_Research.pdf)
After the COVID crash in early 2020, the Composite rose about 125% from the low to a peak in November 2021, then fell 33.10% in 2022.[13](https://www.investopedia.com/nasdaq-vs-sp500-vs-dow-5213252) • [7](https://indexes.nasdaq.com/docs/FS_COMP.pdf) It rebounded over 10,000 in late 2020 and passed 20,000 during the AI-driven rally of 2025.[9](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-vs-dow-key-differences-to-know)
## By the numbers
Calendar-year price returns show the boom-bust-recovery pattern: 43.64% in 2020, 21.39% in 2021, -33.10% in 2022, 43.42% in 2023, 28.64% in 2024, and 20.36% in 2025.[7](https://indexes.nasdaq.com/docs/FS_COMP.pdf) The 10-year annualized price return is 17.59%.[7](https://indexes.nasdaq.com/docs/FS_COMP.pdf)
The late-2023 inflection is visible in monthly returns: October 2023 at -2.78%, November 2023 at +10.70%, and February 2024 at +6.12%.[7](https://indexes.nasdaq.com/docs/FS_COMP.pdf)
## How it compares with other indexes
**Nasdaq-100.** The Composite includes virtually every security listed on Nasdaq, more than 3,000 companies, with broad eligibility criteria. The Nasdaq-100 holds 100 of the largest non-financial Nasdaq companies, requires a minimum three-month seasoning period and volume thresholds, uses modified market-cap weighting that caps total shares at three times free-floating shares, applies concentration constraints, and reconstitutes annually in December with quarterly rebalances.[10](https://www.nasdaq.com/newsroom/nasdaq-composite-vs-nasdaq-100-what-investors-should-know) The Nasdaq-100 underpins more than 178 linked products on 18 exchanges with over $600 billion in tracking assets.[10](https://www.nasdaq.com/newsroom/nasdaq-composite-vs-nasdaq-100-what-investors-should-know)
**S&P 500 and Dow.** The Dow is price-weighted over 30 blue-chip stocks, while the Composite is market-cap weighted over the whole Nasdaq.[9](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-vs-dow-key-differences-to-know) As of August 26, 2026, the Composite's one-year return was 21.13% and five-year return 72.49%, versus 18.66% and 70.14% for the S&P 500 and 17.70% and 50.77% for the Dow; the Composite outperformed over the past 10 years, driven by tech-led bull markets.[13](https://www.investopedia.com/nasdaq-vs-sp500-vs-dow-5213252) From 2003 to 2020 the Nasdaq outperformed the S&P 500 in 12 of 18 years and the Dow 14 times.[8](https://www.nasdaq.com/articles/what-is-the-nasdaq-composite-and-what-companies-are-in-it-2021-05-12) From 2016 to 2026 it gained roughly 380% against 190% for the Dow.[9](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-vs-dow-key-differences-to-know) Because it is dominated by the historically volatile technology sector, its performance tends to be more volatile than the S&P 500 or the Dow Industrials.[5](https://www.investopedia.com/terms/n/nasdaqcompositeindex.asp)
## Recent developments
The AI buildout, spending on data centers, chips, networking, and power, has been the driver of the index's gains since late 2023, with mega-cap chipmakers and platform companies carrying outsized weight.[6](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-performance-september-2026) Through September 30, 2026, the Composite was up 15.6% year-to-date, ahead of the S&P 500's 11.8% and the Dow's 5.9%.[6](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-performance-september-2026)
The rally continued into October. On October 5, 2026, the index closed at 27477.31, a record close, up 18.22% year-to-date.[14](https://www.morningstar.com/news/dow-jones/202610057180/nasdaq-composite-rises-105-to-2747731-record-close-data-talk) On October 6, 2026, it closed at 27599.79, its 24th record close of 2026, up 18.75% year-to-date and 21.11% from 52 weeks earlier.[15](https://www.morningstar.com/news/dow-jones/202610067780/nasdaq-composite-rises-045-to-2759979-24th-record-close-of-2026-data-talk) Its 2026 closing low was 20794.64 on March 30, 2026, so the October level stood 32.73% above that low.[15](https://www.morningstar.com/news/dow-jones/202610067780/nasdaq-composite-rises-045-to-2759979-24th-record-close-of-2026-data-talk)
## References
1. [Nasdaq Composite Index Methodology, Nasdaq](https://beta.indexes.nasdaq.com/docs/methodology_COMP.pdf)
2. [NASDAQ Composite (NASDAQCOM), FRED, St. Louis Fed](https://fred.stlouisfed.org/series/NASDAQCOM)
3. [Overview for COMP, Nasdaq Composite](https://indexes.nasdaq.com/Index/Overview/COMP)
4. [Nasdaq Index Weight Calculations, Nasdaq](https://indexes.nasdaqomx.com/docs/Nasdaq_Index_Weight_Calculations.pdf)
5. [What the Nasdaq Composite Index Reveals About Tech Stocks, Investopedia](https://www.investopedia.com/terms/n/nasdaqcompositeindex.asp)
6. [How Has the Nasdaq Performed So Far in 2026?, Chase](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-performance-september-2026)
7. [Nasdaq Composite Index Fact Sheet, Nasdaq](https://indexes.nasdaq.com/docs/FS_COMP.pdf)
8. [What is the Nasdaq Composite, and What Companies are in it?, Nasdaq](https://www.nasdaq.com/articles/what-is-the-nasdaq-composite-and-what-companies-are-in-it-2021-05-12)
9. [Nasdaq vs. Dow: Key Differences Every Investor Should Know, Chase](https://www.chase.com/personal/investments/learning-and-insights/article/nasdaq-vs-dow-key-differences-to-know)
10. [Nasdaq Composite vs. Nasdaq-100: What Investors Should Know, Nasdaq](https://www.nasdaq.com/newsroom/nasdaq-composite-vs-nasdaq-100-what-investors-should-know)
11. [Nasdaq at 6000, Nasdaq Global Index Research](https://beta.indexes.nasdaq.com/docs/COMP_Research.pdf)
12. [Is Index Concentration an Inevitable Consequence of Market-Capitalization Weighting?](https://escholarship.org/content/qt3kc7174f/qt3kc7174f_noSplash_d124b0c056829f822824173302a03170.pdf)
13. [Nasdaq, S&P 500, Dow: Comparing Key U.S. Stock Indexes, Investopedia](https://www.investopedia.com/nasdaq-vs-sp500-vs-dow-5213252)
14. [NASDAQ Composite Rises 1.05% to 27477.31, Record Close, Dow Jones via Morningstar](https://www.morningstar.com/news/dow-jones/202610057180/nasdaq-composite-rises-105-to-2747731-record-close-data-talk)
15. [NASDAQ Composite Rises 0.45% to 27599.79, 24th Record Close of 2026, Dow Jones via Morningstar](https://www.morningstar.com/news/dow-jones/202610067780/nasdaq-composite-rises-045-to-2759979-24th-record-close-of-2026-data-talk)
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*Topic: Encyclopedia › Society and history › Economics and business › Finance › Stock exchanges and securities markets*
*Initially written Sep 17, 2026 · Reviewed: Oct 10, 2026 · Edited: Oct 10, 2026; Oct 11, 2026; Oct 15, 2026 · Last review: Oct 10, 2026*
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License: Edgepedia Community License 1.0, https://www.edgepedia.org/edgepedia/license