What is the Nasdaq?

The Nasdaq is an American stock index on which many technology companies are listed. When people refer to “the Nasdaq,” they usually mean the Nasdaq Composite Index. This index shows how thousands of primarily American growth companies are performing on the stock market.

 

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The Nasdaq is known for its strong focus on technology and growth companies.

 

The Nasdaq Composite consists of more than 3,000 shares traded on the Nasdaq exchange in the United States. Many well-known technology companies are part of this index, which means the Nasdaq often moves more strongly than broader indices when the technology sector rises or falls.

 

Because growth companies are more sensitive to changes in interest rates and economic expectations, the Nasdaq can show larger fluctuations than, for example, the S&P 500. Investors often use the Nasdaq as an indicator of sentiment surrounding technology shares.

 

 

 

 

Short example:

 

Suppose the Nasdaq stands at 15,000 points. During a period of strong profit growth among technology companies, the index rises by 10%. The Nasdaq then reaches 16,500 points.

 

If an investor has invested €5,000 in an ETF that tracks the Nasdaq, the value increases by approximately 10% to €5,500. When technology shares later come under pressure and the index falls by 10%, the value of that investment decreases to approximately €4,950.

 


Disclaimer: Beleggen brengt risico’s met zich mee. Onze analisten zijn geen financieel adviseurs. Raadpleeg altijd een adviseur bij het maken van financiële beslissingen. De informatie en tips die op deze website zijn verstrekt zijn gebaseerd op eigen inzichten en ervaringen van onze analisten. Deze dienen daarom alleen voor educatieve doeleinden.

 

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