What Is the CAC 40?
The CAC 40 is the French stock market index that tracks the 40 largest French stocks based on the Euronext Paris market capitalization. The CAC 40 started with a base value of 1,000 in December 1987 and continued to operate on a totalmarket capitalizationsystem until 2003 when it was changed to afree float-adjusted market capitalization methodology.
- The CAC 40 is the benchmark equity index for public companies traded on the Euronext Paris.
- The index is made up of the largest 40 companies listed in France screened by market capitalization, trading activity, size of balance sheet, and liquidity.
- The multinational reach of the companies listed on the CAC 40 makes it the most popular European index for foreign investors.
Understanding the CAC 40
CAC 40 stands for Cotation Assistée en Continu, which translates in English to "continuous assisted trading", and is used as a benchmark index for funds investing in the French stock market. The index also gives a general idea of the direction of the Euronext Paris, the largest stock exchange in France formerly known as the Paris Bourse.
The CAC 40 represents a capitalization-weighted measure of the 40 most significant values among the 100 highest market caps on the exchange. The index is similar to the Dow Jones Industrial Average (DJIA) in that it is the most commonly used index that represents the overall level and direction of the market in France.
The CAC 40 index represents the 40 largest equities listed on the Euronext Paris in terms of liquidity, and includes such companies as L’Oreal, Renault, and Michelin.
An independent steering committee reviews the CAC 40 index composition quarterly. At each review date, the committee ranks companies listed on Euronext Paris according to free float market capitalization and share turnover in the previous year. Forty companies from the top 100 are chosen to enter the CAC 40, and If a company has more than one class of shares traded on the exchange, only the most actively traded of these will be accepted into the index.
Impact of CAC 40
The CAC 40 is one of the main national indices of the cross-border European stock exchange, Euronext. Euronext was created in 2000 from the merger of the Amsterdam, Brussels, and Paris stock exchanges. In 2007, Euronext completed their agreed merger with the New York Stock Exchange (NYSE) Group, resulting in the formation of NYSE Euronext.
Euronext manages a variety of exchanges located in six different countries. The company operates the world's most liquid exchange group, with nearly 4,000 listed companies, representing a total market capitalization of approximately $30.5 trillion.
Market capitalization refers to the total dollar market value of a company's outstanding shares. Commonly referred to as market cap, it is calculated by multiplying a company's shares outstanding by the current market price of one share. The investment community uses this figure to determine a company's size, as opposed to using sales or total asset figures. Given its simplicity and effectiveness for risk assessment, market capitalization can be a helpful metric in determining which stocks you are interested in, and how to diversify your portfolio with companies of different sizes.
Trading the CAC 40
A number of exchange-traded funds (ETFs) follow the CAC 40. Among them are:
- Lyxor ETF CAC 40(CAC)
- EasyETF CAC 40 (E40)
- Amundi ETF CAC 40(C40)
- DBXT CAC 40 (X40)
- ComStage ETF CAC 40(PC40)
FAQs
The index is calculated on a price return basis. The calculation is based on the current numbers of shares included in the index of each constituent multiplied by the most recent price and subsequently divided by the divisor. The divisor was determined on the initial capitalization base of the index and the base level.
What is the full form of CAC 40? ›
CAC 40 stands for Cotation Assistée en Continu, which translates in English to "continuous assisted trading", and is used as a benchmark index for funds investing in the French stock market.
What is the return of the CAC 40? ›
Summary. In the 33 years between February 1991 and February 2024 , the CAC 40 index (in EUR) had a compound annual growth rate of 7.95%, a standard deviation of 18.07%, and a Sharpe ratio of 0.45.
How to invest in the CAC 40? ›
Trade the CAC 40® price directly
Using our derivative product, you'll buy or sell CFDs to exchange the price difference of the France 40 between the opening and closing position. To get exposure, you'll go long if you believe that the market price will rise or go short if you think that it'll fall.
What is the price to earnings of CAC 40? ›
The table below lists the current & historical price-earnings ratio of the France equity market, calculated using the CAC 40 equity index. The trailing P/E of the index is currently 13.48 and forward P/E is 13.29 (January 1st, 2024).
Who is the provider of CAC 40 index? ›
The index is operated by Euronext, which also manages stock exchanges across Europe. The company is also responsible for other indices such as the BEL 20 for Belgium and the PSI 20 for Portugal.
What is the CAC meaning? ›
Customer Acquisition Cost, or CAC, measures how much an organization spends to acquire new customers. CAC – an important business metric – is the total cost of sales and marketing efforts, as well as property or equipment, needed to convince a customer to buy a product or service.
What does a CAC stand for? ›
Overview Common Access Card. Common Access Card (CAC) The CAC, a "smart" card about the size of a credit card, is the standard identification for active duty uniformed Service personnel, Selected Reserve, DoD civilian employees, and eligible contractor personnel.
What companies make up the CAC 40? ›
CAC 40 Constituents
| Company | Ticker | Exchange |
|---|
| Axa | CS | Euronext Paris |
| BNP Paribas | BNP | Euronext Paris |
| Bouygues | EN | Euronext Paris |
| Capgemini | CAP | Euronext Paris |
26 more rowsWorst Drawdowns
The maximum drawdown for the CAC 40 was 65.29%, occurring on Mar 12, 2003. Recovery took 4774 trading sessions. The current CAC 40 drawdown is 2.02%.
The DAX (Deutscher Aktien Index) is a stock index based out of Germany that represents the 30 biggest German companies that trade on the Frankfurt Exchange. The index value is calculated every second based on Xetra technology.
Which country is the Nasdaq in? ›
The Nasdaq is one of the major stock exchanges in the United States. More than 5,000 domestic and foreign companies are listed with a major focus on technology.
What time is the CAC 40 trading? ›
Remember, past returns are no guarantee of future performance. The main trading hours for the CAC 40 are between 09:00 – 17:30 (CET). Read more on stock market hours.
How to invest 40k to make money? ›
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The DAX—also known as the Deutscher Aktien Index or the GER40—is a stock index that represents 40 of the largest and most liquid German companies that trade on the Frankfurt Exchange. The prices used to calculate the DAX Index come through Xetra, an electronic trading system.
What is CAC in forex? ›
Take a position on indices
CAC stands for 'Cotation Assistée en Continu', loosely translated in English to 'continuous assisted trading'. The name is derived from its value being updated every 15 seconds from Monday to Friday between 9am and 5.30pm.
What is the all time high of the French stock market? ›
Historically, the France Stock Market Index (FR40) reached an all time high of 8257.40 in April of 2024. France Stock Market Index (FR40) - data, forecasts, historical chart - was last updated on April 15 of 2024.
What country is the CAC market in? ›
The CAC 40 is a benchmark French stock market index.
