The French Index 40, also known as the “Paris Securities Association Index”, is called “CAC40” in English, and is often referred to as “CAC40 Index” in Chinese news reports. It is a very important stock price index in France and the most-watched stock price in the Eurozone. One of the indexes. The CAC40 index was founded by Euronext Paris in 1987 and contains the stocks of 40 important companies listed on the exchange, including Michelin (Michelin), AXA (AXA) and other giants in many fields. Therefore, it can better reflect the economic trends of France and the whole of Europe.

The French Index 40 is a market capitalization-weighted index. Therefore, the greater the market capitalization of the constituent stocks, the greater the impact on the stock index when stock prices fluctuate. However, unlike many market capitalization-weighted indexes ( US Nasdaq 100, etc.), the company’s market capitalization is not the only criterion for inclusion in the CAC40 index, and the constituent stocks in the CAC40 index may not necessarily be the market capitalization of Euronext Paris.

The specific situation is: Euronext Paris has developed a ranking method to screen companies. This ranking combines the two factors of stock liquidity and company market value, and the stocks of the top 40 companies can become constituent stocks of the CAC40 index. But generally speaking, all the companies selected in the CAC40 index have a market value of at least the top 100 in Euronext Paris. Euronext Paris will approve the French Index 40 quarterly in March, June, September, and December every year to ensure that the index can fully reflect the trend of the French stock market, and substandard constituent stocks will be moved. Except, non-constituent stocks that meet the criteria will be included.

In addition, although the companies in the CAC40 index are almost all local French companies, a considerable part (about 40%) of the market value is held by foreign investors. This may be because most of these companies are multinational companies.

Go to FXBonus.Info Main Page