The widely watched index is comprised of the top 100 non-financial stocks by market cap that trade on the Nasdaq (^IXIC), including heavyweights like Apple (AAPL), Google (GOOG), Microsoft (MSFT) and Oracle (ORCL). With a $60+ billion market cap, Facebook replaces Infosys (INFY), which is moving to the New York Stock Exchange (NYX).
Facebook's inclusion is largely seen as a positive due to the popularity of the NDX among ETFs and mutual funds. "The question that has to be asked though, is that given the corporate governance practices in place at Facebook -- namely Zuckerberg's totalitarian control of the company and the ability to appoint his own successor and the risk that puts on minority shareholders -- are other indices like the S&P 500 going to follow suit?" asks David Garrity, principal at GVA Research. "That is very much an open question because there have been doubts raised about Facebook."
Facebook shares have seen plenty of ups and downs since the initial public offering on May 18. The stock debuted at $38 a share and was more than cut in half after a series of insider share lockup periods began expiring.
The first expiration in mid-August set off a downward spiral that took the stock to its all-time low of $17.55 on Sept. 4. Facebook has since recovered 55% from the low despite expirations in October and November that put a combined 1 billion shares on the market.Read More »from Nasdaq 100 to Friend Facebook: Should You Too?