The Surprising Stock About to Join the Nasdaq 100

"The Nasdaq 100 is an index most often associated with technology stocks like Nvidia ( NASDAQ:NVDA ) and Apple ( NASDAQ:AAPL ) due to its historical focus on innovation and high-growth companies. While it is not a "pure" technology index - there is a separate Nasdaq 100 index devoted exclusively to tech stocks - its heavy tilt towards tech-driven companies makes it the benchmark many investors associate with technology."

"Despite the index's reputation for being the premier tech index, it actually is home to a variety of companies in different sectors, including retailers like Costco ( NASDAQ:COST ), beverage companies such as PepsiCo ( ), as well as other consumer-facing companies including Starbucks ( NASDAQ:SBUX ), Kraft Heinz ( ), and Lululemon Athletica ( NASDAQ:LULU ). Yet it's this diversity sprinkled among tech giants such as Microsoft ( NASDAQ:MSFT ) and Broadcom ( NASDAQ:AVGO ), that makes them the exceptions that prove the rule."

"Nasdaq determines companies for inclusion in the index based on criteria such as being listed exclusively on the Nasdaq Global Select or Global Market tiers, having an average daily trading volume of at least 200,000 shares, and maintaining a minimum three-month average daily traded value of $5 million. Companies must also have a free float of at least 10%, be publicly traded for at least three months, be current with quarterly and annual reports, and not be in bankruptcy proceedings."

The Nasdaq 100 is heavily weighted toward technology and high-growth companies such as Nvidia and Apple, but also includes non-tech large-cap firms across consumer and retail sectors. Walmart will be added to the index on Jan. 20, representing a notable non-technology inclusion. The index contains retailers, beverage firms, and consumer-facing companies alongside tech giants like Microsoft and Broadcom, reflecting the intersection of technology with traditional industries while remaining tech-dominated. Nasdaq selects constituents based on listing tier, trading volume and value thresholds, free float, reporting status, trading history, and excludes financial companies, with annual rebalancing in December.

Read at 24/7 Wall St.