No. of Recommendations: 0
Actually not my screens, they are Robbie Geary's so I have confidence in them.
From Robbie. "^N1T" is my symbol for the market capitalization-weighted total return portfolio whose constituents are those of the actual NASDAQ 100 back to index inception in 1985, and those of the "Pseudo NASDAQ 100" (NASDAQ's current rules for ^NDX applied retroactively at each point-in-time back to 19721214) before that back to 19721214." Post 268261 on the old MI board.
First, a geeky note, the Nasdaq 100 is not market cap weighted, nor float-adjusted cap weighted. When something gets too big (highly discretionary) they cut its weight back, then when its market cap inevitably shrinks back it shrinks back to much less than cap weight, then it happens again...the weights are all messed up.
My understanding is the weights never exceed the market cap weight, so if the market cap weight gets too large, there is an adjustment downwards in the weighting pushing QQQ towards the QQQE weightings. If there is a concern about the QQQ weightings, all 100 could be easily purchased using weightings in the NDX100 rather than QQQ.
I think the graphs I posted, you may not be able to see them as they are on the MF board, clearly show the outperformance of cap weighted vs equal weighted since 1972. If there is a concern that a person does not want a large concentration in a stock, then a lower return may be acceptable.
Aussi
