The Nasdaq-100® (NDX®) is a globally recognized index of the 100 largest innovative companies listed on the Nasdaq Stock Market®. Originating in 1985 and recently celebrating 40 years as the largest US equity index, the NDX has already surpassed its core identity as the benchmark for many of the world’s most innovative companies; it has become the foundation of a complex and dynamic environment of investment vehicles and instruments. This development reflects the transformation of the index from its initial support of emerging technology companies into a unique proxy for the global economy of the 21st century.
Today – after several decades of product innovation and index growth to support AUM – the Ecosystem is primarily driven by the following six product types:
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Index-based Benchmarking
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Exchange Products for Sale
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Mutual Funds
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Derivatives
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Insurance
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Constructed Notes
Using the 6 key financial products that markets interact with the Nasdaq-100, we examine the relative sizes of each product. Although the size is expressed in different terms for each product (for example: Open Contract Interest Derivatives, Assets Under Management ETFs, etc.), these metrics are made common by evaluating the value of each product during 2025. Notional value shows the leverage of derivatives by taking into account the underlying assets that determine their payments. For money-backed products, AUM was determined as an accurate measure of notional amount.
Figure 1: Estimated 2025 Market Size (Typical Value) for All Global NDX Products ($s)
Source: Nasdaq, CME, OCC, Factset, Bloomberg, Morningstar. ETF and Mutual Fund sizes reflect Assets Under Management that are linked or indexed to the NDX. ETF and Mutual Fund sizes reflect average AUM throughout 2025. Scheduled Note and insurance sizes show the amount of money invested in live payments as of 12/31/2025. Derivative sizes reflect the average net profit assumed through 2025. Total NDX size data is stated in trillions rounded to one decimal place, XND Flex Option Size is stated in billions rounded to two decimal places, XND List Option Size is stated in billions rounded to one decimal place, and all other billions are rounded to the nearest whole number.
At the top level, 46% of the $1.41 trillion of total Nasdaq-100 value identified in 2025 is held in derivatives, while 42% is in ETFs. Between 2024 and 2025, more than $350 billion of Nasdaq-100 notional value was added to the entire measured ecosystem. Compared to the broader US markets, there are two trends in investor preferences that continue to be reflected in the ecosystem:
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Focus on long-term passive exposure only to track NDX performance.
With it above average annual returns and focused on Nasdaq-listed companies, market participants generally view the NDX as a differentiator rather than a barometer of the US Equity Markets (as the S&P 500 is often viewed). As a result, fund managers typically (if at all) benchmark themselves against NDX, and only long-term investors choose direct exposure to NDX. This is evident from the prominence of QQQ again QQQMcombined they make up about 70% of the total ETF market capitalization; only a small portion can be considered actively managed, in the case of certain NDX Options Overlay ETFs.
2. Custom exposures focus on beta over alpha.
Investors seeking exposure to NDX due to its perception as a “diversified” product often focus on managing risk and volatility according to specific portfolio goals, as opposed to generating alpha by taking active risk against a benchmark. These needs are met in a wide range of products, from the ~$650bn listed and variable market, to the “secured” variety delivered by the ~$200bn market for fixed notes, insurance, and leveraged/inverse/options ETFs. Combined, these risk-focused solutions account for approximately 59% of NDX’s asset tracking portfolio.
Overall, the combination of passive and active strategies has created a flexible and robust investment climate for NDX, enabling investors to pursue a wide range of investment objectives with flexibility.
When approaching the growth of the NDX over the past 15 years, it is also important to understand how the major US equity markets have evolved over this period. The shares that have the greatest impact on the growth of the market have mainly been the components of NDX; all seven of the “Magnificent 7” companies are listed on the Nasdaq and included in the NDX. Although large stocks are often seen as companies with market capitalization more than $10 billion as of 2025, this static metric ignores the growth US equity markets have seen over this period.
A flexible way to define a large cap stock is to measure the market cap of the lowest 5 percent of the stocks in the Nasdaq US Large Cap™ Index (NQUSL™) at the end of each year. NQUSL represents a major component of the Nasdaq US Benchmark™ Index (NQUSB™) and includes stocks ranked among the top 75% of that index’s market capitalization. Using this approach, the capital cap threshold has grown from $4.2bn in 2011 to $22.9bn in 2025 – a five-fold increase. The chart below shows how the smallest companies in the NDX and the S&P 500 (SPX) measure up against the large cap variable:
Figure 2: NDX and SPX Minimum Market Cap vs. Dynamic Large Cap Threshold
Source: Nasdaq, Factset, Bloomberg. All data is from the end of each year and between 12/31/2011 and 12/31/2025.
While almost all of the NDX remains in line with these increases, the SPX includes a significant number of sub-cap market segments, resulting in significant mid-cap exposure within the index. Given that NDX shares have consistently followed the large-cap coverage threshold, the index’s 100-share composition across nearly all sectors serves as a balance between diversification and unrefined large-cap exposure. This supports the emerging vision of the Nasdaq-100 Index® as a large-cap index and reinforces its status as the “Benchmark of the 21st Century”.
Click here to view the full white paper on the Nasdaq-100 ecosystem.
To learn more about NDX, check out the following resources:
Landing Page | One Pager | Product Guide | A benchmark for the 21st century |
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Footnote:
The Magnificent 7 stocks include Alphabet (parent of Google), Amazon, Apple, Meta Platforms (parent of Facebook), Microsoft, Nvidia, and Tesla. While it’s rarely included in the Magnificent 7, Broadcom’s market share has often matched (if not exceeded) Tesla’s in recent years.
Disclaimer:
Nasdaq®, Nasdaq-100 Index®, Nasdaq-100®, NDX®, and QQQ® are registered trademarks of Nasdaq, Inc. The information contained above is provided for informational and educational purposes only, and nothing contained herein should be construed as investment advice, on behalf of a particular security or overall investment strategy. Nasdaq, Inc. or any of its affiliates make recommendations to buy or sell any security or make any representation regarding the financial condition of any company. Statements regarding Nasdaq-listed companies or Nasdaq proprietary indices are not guarantees of future performance. Actual results may differ materially from those stated or implied. Past performance is not indicative of future results. Investors should do their own due diligence and carefully evaluate companies before investing. ADVICE FROM A SECURITIES PROFESSIONAL IS STRONGLY ADVISED.
The information set forth in this release contains forward-looking statements that involve a number of risks and uncertainties. Nasdaq cautions readers that any forward-looking information is not a guarantee of future performance and that actual results may differ materially from those contained in the forward-looking information. Forward-looking statements can be identified by words such as “will”, “may”, and other words and terms with similar meaning. Such forward-looking statements include, but are not limited to, statements related to the projected future growth of the Nasdaq-100 ecosystem. Forward-looking statements involve a number of risks, uncertainties or other factors beyond Nasdaq’s control. These risks and uncertainties are detailed in Nasdaq’s filings with the US Securities and Exchange Commission, including its annual reports on Form 10-K and quarterly reports on Form 10-Q available on Nasdaq’s investor relations website at and the SEC website at www.sec.gov. Nasdaq undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.
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Written by Pranay Dureja Derivatives and QIS Index Research, Nasdaq Global Indexes
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