New member in Nasdaq 100 Index!

After the market close on December 10,  the Nasdaq (Nasdaq) issued a notice that the annual adjustment of the Nasdaq-100 index (Nasdaq-100) will be made, and it will officially take effect before the market on December 20. This annual adjustment will include the following 6 new stocks: Airbnb, Inc. Fortinet, Inc. Palo Alto Networks, Inc. Lucid Group, Inc. Zscaler, Inc. Datadog, Inc.

The Nasdaq 100 Index is a list of the top 100 non-financial companies by market capitalization listed on the Nasdaq sector. The index is rebalanced quarterly and formally adjusted on the third Friday of December every year, using a weighted method of total market capitalization. Companies joining Nasdaq typically go through several rounds of "trials." First, companies must meet the rules, such as they cannot be financial companies, but exceptions such as more liquid American Depositary Receipts (ADRs) are also allowed;

In general, inclusion in the Nasdaq 100 improves a company's liquidity and provides a broader investor base to invest through index funds. According to data analysis over the years, from before the announcement to the five days after being included in the index, the newly included stocks outperformed the broader market by an average of 1%. Historically, they will also outperform the S&P 500 over the next year.