CAC 40

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CAC 40
CAC 40.png
CAC 40 performance between 1964 and 2012
Foundation 1987
Operator Euronext
Exchanges Euronext Paris
Constituents 40
Type Large cap
Market cap 1.031 trillion (end 2009)[1]
CAC Next 20, CAC Mid 60, CAC Small

The CAC 40 (French: CAC quarante [kak kaʁɑ̃t]) (Cotation Assistée en Continu) is a benchmark French stock market index. The index represents a capitalization-weighted measure of the 40 most significant values among the 100 highest market caps on the Paris Bourse (now Euronext Paris). It is one of the main national indices of the pan-European stock exchange group Euronext alongside Brussels' BEL20, Lisbon's PSI-20 and Amsterdam's AEX.


The CAC 40 takes its name from the Paris Bourse's early automation system Cotation Assistée en Continu (Continuous Assisted Quotation). Its base value of 1,000 was set on 31 December 1987, equivalent to a market capitalisation of 370,437,43 3,957.70 French francs.[2] In common with many major world stock markets, its all-time high to date (6922.33 points) was reached at the peak of the dot-com bubble in September 2000.[3] In 1 December 2003, the index's weighting system switched from being dependent on total market capitalisation to free float market cap only, in line with other leading indices.[4]



The CAC 40 index composition is reviewed quarterly by an independent Index Steering Committee (French: Conseil Scientifique).[2] If any changes are made, they are effected a minimum of two weeks after the review meeting.[2] At each review date, the companies listed on Euronext Paris are ranked according to free float market capitalisation and share turnover over the prior 12 months.[5] From the top 100 companies in this ranking, forty are chosen to enter the CAC 40 such that it is "a relevant benchmark for portfolio management" and "a suitable underlying asset for derivatives products".[5] 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 (generally this will be the ordinary share).[5]


The CAC 40 is a capitalization-weighted index. The number of shares issued (used to calculate the market cap and hence the index weight) of a company is reviewed quarterly, on the third Friday of March, June, September and December.[2] Since December 2003, the index weightings of companies in the index have been capped at 15% at each quarterly index review,[5] but these range freely with share price subsequently. A capping factor is used to limit the weights to 15% (if necessary), and is reviewed annually by the Index Steering Committee on the third Friday of September.[5]


The index value I of the CAC 40 index is calculated using the following formula:[5]  I_t = 1000\times\frac{\sum_{i=1}^N Q_{i,t}\,F_{i,t}\,f_{i,t}\,C_{i,t}\,}{K_t\,\sum_{i=1}^N Q_{i,0}\,C_{i,0}\,} with t the day of calculation; N the number of constituent shares in the index (usually 40); Qi,t the number of shares of company i on day t; Fi,t the free float factor of share i; fi,t the capping factor of share i (exactly 1 for all companies not subject to the 15% cap); Ci,t the price of share i on day t; Qi,0 the number of shares of company i on the index base date; Ci,0 the price of equity i on the index base date; and Kt the "adjustment coefficient for base capitalization" on day t (reflecting the switch from the French franc to the Euro in 1999).


Although the CAC 40 is almost exclusively composed of French-domiciled companies, about 45% of its listed shares are owned by foreign investors, more than any other main European index.[6] German, Japanese, American and British investors are amongst the most significant holders of CAC 40 shares. This large percentage is due to the fact that CAC 40 companies are more international, or multinational, than any other European market. CAC 40 companies conduct over two-thirds of their business and employ over two-thirds of their workforce outside France.[7]


An Ariane 5 launcher, built by Astrium EADS, equipped with Vulcain II engine manufactured by Snecma Safran.
A Louis Vuitton store in Hong Kong, part of LVMH group.
A high-speed train TGV Duplex manufactured by Alstom.
Renault Zoe, a five-door supermini electric car manufactured by Renault.
Pont de Normandie, built by Bouygues and Vinci, the largest construction company in the world by revenue.

The index consists of the following companies as of the quarterly update effective 19 December 2011 which saw Legrand replace Suez Environnement.[8]

Company ICB Sector Ticker symbol Index weighting (%) at 17 January 2013 Market cap. at April 2013 (Billion €)[9]
Accor hotels AC 0.65 6.02
Air Liquide commodity chemicals AI 4.08 29.49
Airbus Group aerospace AIR 1.89 31.82
Alstom industrial machinery ALO 0.96 9.40
ArcelorMittal steel MT 1.69 15.4
AXA full line insurance CS 3.40 31.45
BNP Paribas banks BNP 6.24 48.78
Bouygues heavy construction EN 0.60 6.57
Capgemini computer services CAP 0.70 5.56
Carrefour food retailers and wholesalers CA 1.54 14.67
Crédit Agricole banks ACA 1.02 15.65
EDF electricity EDF 0.57 28.78
Essilor medical supplies EI 2.05 17.74
Gemalto cyber security GTO 0.76 5.86
GDF Suez gas distribution GSZ 2.84 37.22
Groupe Danone food products BN 4.07 34.37
L'Oréal personal products OR 3.65 73.48
Lafarge building materials and fixtures LG 1.25 13.83
Legrand electrical components and equipment LR 1.14 8.74
LVMH clothing and accessories MC 5.02 65.95
Michelin tires ML 1.85 11.56
Orange telecommunications ORA 2.27 20.44
Pernod Ricard distillers and vintners RI 2.52 25.04
PPR broadline retailers PP 1.64 20.85
Publicis media agencies PUB 1.19 11.15
Renault automobiles RNO 1.10 14.67
Safran aerospace and defence SAF 1.08 14.37
Saint-Gobain building materials and fixtures SGO 1.78 14.57
Sanofi pharmaceuticals SAN 12.19 102.87
Schneider Electric electrical components and equipment SU 4.04 33.14
Société Générale banks GLE 3.04 19.82
Solvay chemicals SOLB 0.94 8.54
STMicroelectronics semiconductors STM 0.54 5.25
Technip oil equipment and services TEC 1.18 9.24
Total integrated oil and gas FP 11.96 86.94
Unibail-Rodamco real estate investment trusts UL 2.31 16.80
Vallourec industrial machinery VK 0.58 4.56
Veolia Environnement water VIE 0.44 5.01
Vinci heavy construction DG 2.42 20.34
Vivendi broadcasting and entertainment VIV 2.77 21.32

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