Nasdaq to Accelerate Inclusion of Large IPOs in the Nasdaq 100 Index

PANews, March 30: Nasdaq will introduce a series of new rules, including accelerating the process for incorporating large newly listed companies into the Nasdaq-100 Index, aiming to reduce the waiting time for firms to enter this flagship index. As high-valued tech companies such as SpaceX and OpenAI prepare for their IPOs, exchange operators are seeking to expedite the listing process. Lilia, Head of Nasdaq Global Index Solutions, stated that Nasdaq is considering rule adjustments to ensure that newly listed large companies and those transitioning from other exchanges can be included in the Nasdaq-100 Index without enduring waits of a year or longer. Nasdaq announced that the new rules, including the “fast inclusion” mechanism, will take effect on May 1, though most adjustments are expected to impact index composition only starting in June. Fast Inclusion: Under the “fast inclusion” rule, Nasdaq will assess a newly listed stock’s eligibility for inclusion based on its market capitalization ranking on the seventh trading day after listing and determine whether it ranks within the top 40 constituents of the index. If all criteria are met, the company will be fast-tracked into the Nasdaq-100 Index on its 15th trading day after listing. Other Adjustments: Additional rule changes for the Nasdaq-100 Index include: 1. A new market capitalization calculation method that combines publicly traded shares with non-public shares across different share classes. 2. Elimination of the requirement that a company must have at least 10% of its shares publicly traded. 3. Companies with lower public float ratios will receive lower weightings in the index. 4. Companies whose weight in the index falls below 10 basis points for two consecutive months will be removed and replaced by the next largest eligible company. 5. Total share data will be updated quarterly, replacing the current ad hoc update mechanism.