FTB-C000142 / Formula component

Index Weight

Index weight is a constituent's proportional contribution basis within an index at a specified calculation state.

Also known asconstituent weightportfolio weight

Foundation Formula defined 20 linked topicsPublished

Definitions

In plain terms

A 5% weight means that constituent represents 5% of the declared index weighting basis at that point.

Technical

Weight is the constituent's eligible weighted value divided by the aggregate eligible value, after currency, float, capping, and timing rules.

Scope

Current weight, target weight, opening weight, and return contribution are different quantities.

Formula

w_i = X_i / sum(X_j)
LaTeX: w_i=X_i/\sum_j X_j
SymbolMeaningUnit
X_ieligible weighted value for constituent ivalue unit
X_jeligible weighted values for all constituentsvalue unit

Output unit: decimal weight

Examples

  • A governed index record identifies index weight with its applicable methodology version, effective time, source, and units.

Common misconceptions

  • Index Weight does not have one universal implementation without the named index methodology, data cutoff, and governance context.

Concept relationships

Prerequisites

Related

Required by

Where this concept is used

Tutorials planned

These catalogued topics use this concept, but their complete build has not shipped yet.

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Evidence and governance

  1. S&P Dow Jones Indices Index Mathematics Methodology S&P Dow Jones Indices · first party methodology

    Supports: preferred label, short definition, technical definition, formula

    Limits: Authoritative for the provider's indices; conventions are not universal defaults for every index or security-level return series.

  2. Fintech Builder Glossary Definition Contract The Fintech Builder · internal governed contract

    Supports: variant distinction

    Limits: Defines governed platform behavior rather than claiming these policies are universally prescribed by external McClellan methodology.

Reviewed by
Last reviewed
2026-07-27
Next review
2027-07-27
Record status
published
Written by

Fintech engineer building market-data and financial systems, and the author of every article, glossary record, and reference implementation on The Fintech Builder.