Definitions
In plain terms
Larger companies generally receive larger weights, subject to the methodology's share, float, currency, and capping rules.
Technical
The calculation aggregates eligible price times shares and applicable factors, converts currency when required, and scales by a maintained divisor.
Scope
The label must state whether capitalization is full, free-float adjusted, capped, or otherwise modified.
Examples
- A governed index record identifies market-capitalization-weighted index with its applicable methodology version, effective time, source, and units.
Common misconceptions
- Market-Capitalization-Weighted Index does not have one universal implementation without the named index methodology, data cutoff, and governance context.
Concept relationships
Prerequisites
Broader concepts
Contrasts with
Where this concept is used
Evidence and governance
- S&P Dow Jones Indices Index Mathematics Methodology S&P Dow Jones Indices · first party methodology
Supports: preferred label, short definition, technical definition
Limits: Authoritative for the provider's indices; conventions are not universal defaults for every index or security-level return series.
- 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
- fintech-builder-owner-approved
- Last reviewed
- 2026-07-27
- Next review
- 2027-07-27
- Record status
- published