A security will no longer be added to either the NASDAQ Financial-100 Index or the NASDAQ Biotechnology Index if the issuer of the security has entered into a definitive agreement or other arrangement that would likely result in the security no longer being index-eligible. Previously, a company was not eligible to be added to one of these two indexes only if the company's index eligibility was expected to end within six months following inclusion. This provision is being revised so as to conform it to a similar existing requirement of the NASDAQ-100 Index.
In addition, as part of the NASDAQ Financial-100 Index's ranking review, an otherwise eligible security will be retained in the index if it ranks between 101 and 125 by market value, provided it was ranked within the top 100 securities as of the previous ranking review. Previously, a security was retained if it ranked between 101 and 150, provided it had ranked in the top 100 securities as of the previous ranking review. Again, this provision is being revised in order to conform it more closely to a similar requirement of the NASDAQ-100 Index.
Finally, the following modification will affect all three indexes -- the NASDAQ-100 Index, the NASDAQ Financial-100 Index and the NASDAQ Biotechnology Index: a security will not be included, and will not be eligible to remain in the index, if the issuer's auditor has withdrawn its audit opinion. This is a revision of an existing restriction, which excludes a company from index eligibility whenever the company or its auditor indicates that the annual financial statements cannot currently be relied upon.
"These updates are part of NASDAQ's ongoing review of its index criteria. From time to time, NASDAQ adjusts the criteria in order to preserve and enhance the integrity of the indexes and their value to investors," said John Jacobs, Executive Vice President, The Nasdaq Stock Market, Inc.
The NASDAQ-100 Index is composed of 100 of the largest non-financial stocks on NASDAQ and dates to January 1985, when it was launched along with the NASDAQ Financial-100 Index, which is comprised of 100 of the largest financial stocks on NASDAQ. The NASDAQ Biotechnology Index is composed of companies that are classified according to the FTSE(TM) Global Classification System as either biotechnology or pharmaceutical and which meet other eligibility criteria.
No changes were made to the criteria for NASDAQ's other sector indexes.
NASDAQ is the largest U.S. electronic stock market. With approximately 3,200 companies, it lists more companies and, on average, trades more shares per day than any other U.S. market. It is home to companies that are leaders across all areas of business including technology, retail, communications, financial services, transportation, media and biotechnology. NASDAQ is the primary market for trading NASDAQ-listed stocks. For more information about NASDAQ, visit the NASDAQ Web site at http://www.nasdaq.com or the NASDAQ Newsroom at http://www.nasdaqnews.com/.
To learn more about the criteria for inclusion in the NASDAQ Indexes, visit http://quotes.nasdaq.com/reference/IndexDescriptions.stm
NASDAQ is licensed by FTSE to use the FTSE Global Classification System.
The FTSE Global Classification System is compiled by FTSE International Limited ("FTSE") (C) FTSE International Limited 2005. All rights reserved.
"FTSE(TM)" is a trade mark of the London Stock Exchange Plc and The Financial Time Limited
