Stock A has 10 million shares issued and stock B has 5 million shares issued.What is their relative weighting if both stocks are represented in the S&P 500?

Question

Quizplus · Accepted Answer

The weighting of a stock in the S&P 500 is based on its market capitalization, which is calculated by multiplying the number of shares issued by the current market price per share. Therefore, stock A having 10 million shares issued will likely have a larger market capitalization than stock B with only 5 million shares, resulting in a higher weighting in the S&P 500. As a result, A has twice the weighting, to account for having more shares.

Stock a Has 10 Million Shares Issued and Stock B