"The re-ranking is based on a number of objective criteria with market capitalization a key factor," said John L. Jacobs, president and chief executive officer of Nasdaq Financial Products Services Inc., a subsidiary of Nasdaq. "We re-rank the index every year at this time and it is based on the number of shares outstanding and stock price. It reflects the current economy."
The following 13 issues will be added to the Nasdaq-100 Index: ImClone Systems Incorporated (Nasdaq:IMCL), Charter Communications, Inc. (Nasdaq:CHTR), CDW Computer Centers, Inc. (Nasdaq:CDWC), Symantec Corporation (Nasdaq:SYMC), Sepracor Inc. (Nasdaq:SEPR), Invitrogen Corporation (Nasdaq:IVGN), Express Scripts, Inc. (Nasdaq:ESRX), Cephalon, Inc. (Nasdaq:CEPH), ICOS Corporation (Nasdaq:ICOS), Cytyc Corporation (Nasdaq:CYTC), Protein Design Labs, Inc. (Nasdaq:PDLI), Integrated Device Technology, Inc. (Nasdaq:IDTI) and Synopsys, Inc. (Nasdaq:SNPS).
"The Nasdaq-100 is the most sought after index by investors in the world. It's composed of the premier non-financial growth companies in the economy and the index has become a financial benchmark for investors globally," said Jacobs. "In fact, it has outperformed every other major stock index in the U.S. for the 10 year period beginning December 1991, although past performance is not necessarily indicative of future performance."
"Unlike other major financial indices, the Nasdaq-100 is not a beauty contest," Jacobs continued. "Companies once dropped from the Index may rejoin it if their performance warrants because inclusion is based on objective criteria. This year, Synopsys, Inc. and Symantec Corporation are rejoining the Index. We welcome them back."
There are 23 domestic mutual funds and seven international funds linked to the Nasdaq-100 Index. Shares of each company in the Index are also included in the Nasdaq-100 Index Tracking StockSM (Amex:QQQ), which represents ownership in the Nasdaq-100 TrustSM. The Trust holds a portfolio of equity securities that comprise the Nasdaq-100 Index and aims to provide investment results that generally correspond with the Nasdaq-100 Index performance. Since its inception in March 1999, the Trust's total assets have grown to over $22 billion.
The QQQ index tracking stock, which is an exchange-traded fund (ETF) that trades like a stock, is the world's most actively traded ETF. On most trading days, it is also the second most actively traded security in the U.S.
The Nasdaq-100 Index is composed of the 100 largest non-financial stocks on the Nasdaq Stock Market and dates to January 1985 when it was launched along with the Nasdaq Financial-100 Index, which is the 100 largest financial stocks on Nasdaq. These indices were originally designed to segment Nasdaq into two major industry groups to support media coverage and to act as benchmarks for financial products such as options, futures, and funds.
The Nasdaq-100 is re-ranked in December each year, while the Nasdaq Financial-100 is re-ranked each June. Both re-rankings are timed to coincide with the respective triple witch options expiration Friday of the quarter.
"Scheduled re-rankings improve each indice's value as a benchmark for investors and as metrics in the media and public domain," said Jacobs.
All securities in the Index are among the top 150 eligible securities by market capitalization based on closing prices as of October 31, 2001, and the publicly reported total shares outstanding as of November 30, 2001. Index securities which are already in the index and are in the top 150 eligible securities, are retained in the index, provided that such security was ranked in the top 100 eligible securities during the last year's ranking. For more information about the Nasdaq-100 Index including eligibility criteria visit www.nasdaq-100.com.
As a result of the re-ranking of the Nasdaq-100 Index, the following 13 companies will be removed: Ariba, Inc. (Nasdaq: ARBA), BroadVision, Inc. (Nasdaq: BVSN), CMGI, Inc. (Nasdaq:CMGI), CNET Networks, Inc. (Nasdaq: CNET), 3Com Corporation (Nasdaq:COMS), Inktomi Corporation (Nasdaq:INKT), Level 3 Communications, Inc. (Nasdaq:LVLT), McLeodUSA Incorporated (Nasdaq:MCLD), Metromedia Fiber Network, Inc. (Nasdaq:MFNX), Novell, Inc. (Nasdaq:NOVL), Palm, Inc. (Nasdaq:PALM), Parametric Technology Corporation (Nasdaq:PMTC) and RealNetworks, Inc. (Nasdaq:RNWK).
The Nasdaq-100 Index, launched in January 1985, has risen over 1100% percent since inception, although past performance is not necessarily indicative of future performance.
Annual adjustments were first implemented in 1993 in anticipation of Nasdaq-100 Index options trading on the Chicago Board Options Exchange in 1994 under the symbol "NDX." In April 1996, Nasdaq-100® futures and options on futures began trading on the Chicago Mercantile Exchange under the ticker "ND."
The Nasdaq Stock Market lists over 4,100 companies and trades more shares per day than any other U.S. market. For more information about Nasdaq, visit the Nasdaq Web site at www.nasdaq.com or the Nasdaq NewsroomSM at www.nasdaqnews.com. For more information about the Nasdaq-100, visit www.nasdaq-100.com.
