Apple’s influence in major stock indexes will soon be fully unleashed

Warren Buffett’s Berkshire Hathaway’s sale of nearly half of its Apple shares in Q2 has come with a surprise silver lining for AAPL investors: Its influence in major stock indexes is set to be fully unleashed.
Lu Wang and Yiqin Shen for Bloomberg News:
‎

Apple’s weighting in a slew of benchmarks has been depressed for years because Buffett’s Berkshire Hathaway Inc. tends to hold its investments for the long run, making them unavailable for trading. As a result, index providers calculated the tech company’s weight based on a methodology known as float-adjusted market capitalization.
Put simply, Apple’s true value is not reflected in many indexes.
In percentage terms, the numbers don’t seem huge — in the case of the S&P 500, for instance, 94% of Apple’s value is currently considered. That should now increase to 100%, according to Piper Sandler & Co. But in a $3 trillion company, it adds up.
In the wake of Berkshire’s sale, passive funds tracking these indexes may now have to buy as much as $40 billion of Apple stock when they next rebalance, according to Piper Sandler’s estimates. That’s triple the average daily trading volume of the company’s shares over the past month.

Support MacDailyNews at no extra cost to you by using this link to shop at Amazon.
‎
MacDailyNews Note: The S&P 500 is rebalanced quarterly, usually on the third Friday of March, June, September, and December.
‎
Please help support MacDailyNews. Click or tap here to support our independent tech blog. Thank you!
Support MacDailyNews at no extra cost to you by using this link to shop at Amazon.
The post Apple’s influence in major stock indexes will soon be fully unleashed appeared first on MacDailyNews.