Definition
The FT Wilshire 5000 Index (FTW5000) is a stock market index that seeks to capture 100% of the investible U.S. stock market by tracking the performance of nearly all publicly traded companies in the United States. Originally known as the Wilshire 5000 Total Market Index (TMWX) before being rebranded on June 30, 2021, this index used to include over 7,500 stocks at its peak, but currently has about 3,687.
FT Wilshire 5000 Index vs Wilshire 5000 Total Market Index Comparison
| Feature | FT Wilshire 5000 Index (FTW5000) | Wilshire 5000 Total Market Index (TMWX) |
|---|---|---|
| Notation | FTW5000 | TMWX |
| Number of Stocks at Peak | Over 7,500 | Same (Before rebranding) |
| Current Number of Stocks | 3,687 | N/A (Post rebranding) |
| Purpose | 100% coverage of the U.S. market | 100% coverage of the U.S. market |
| Date of Rebranding | June 30, 2021 | N/A |
Related Terms
- Stock Market Index: A statistical measure that reflects changes in the stock market, typically by tracking the performance of selected stocks.
- Market Capitalization: The total market value of a company’s outstanding shares, often used to gauge its size and investment potential.
- Investable Market: The portion of the entire market consisting of companies whose stocks can be bought and sold by investors.
Example
If you decided to invest in a mutual fund that tracks the FT Wilshire 5000 Index, you would be investing in a wide-spanning portfolio aimed at capturing the performance of virtually the entire U.S. economy. It’s like having one foot in a luxury yacht and the other on a sturdy fishing boat. You might enjoy the view from the yacht, but sometimes you’ve got to throw a line over the side!
Insights & Humor 🤣
- In its prime, the FT Wilshire 5000 Index was known as “the index with more stocks than a fish market!”.
- Notably, during a focus group on rebranding, one creativity chestnut was to call it “The Wilshire Index for All Stock Lovers”. I think they went with FTW5000 instead—thank goodness!
Fun Facts
- The FT Wilshire 5000 Index was born in 1974 and has been a go-to for investors wanting to measure the overall performance of the U.S. equity market.
- At its height, the FT Wilshire 5000 Index had enough stocks to open a very large brokerage firm in a trendy co-working space!
Frequently Asked Questions
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What is the purpose of the FT Wilshire 5000 Index?
- Its primary purpose is to provide a comprehensive representation of the U.S. stock market, acting as a benchmark for investment performance.
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Why did the Wilshire 5000 change its name?
- The rebranding to FT Wilshire 5000 was part of a partnership with The Financial Times to emphasize its global reach and trusted financial insight.
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How often is the index updated?
- The FT Wilshire 5000 Index is updated daily, so it’s as fresh as your morning coffee!
References
- FT Wilshire 5000 Index Overview
- Investopedia - Wilshire 5000 Definition
- “The Intelligent Investor” by Benjamin Graham: A must-read for understanding stock strategies!
Test Your Knowledge: FT Wilshire 5000 Index Quiz
## What does the FT Wilshire 5000 Index aim to capture?
- [x] 100% of the investable U.S. market
- [ ] 50% of stocks from top corporations
- [ ] High-performing stocks only
- [ ] Just the top 10 technology companies
> **Explanation:** The FT Wilshire 5000 Index seeks to include all investable U.S. stocks to provide a comprehensive view.
## How many stocks does the FT Wilshire 5000 Index currently have?
- [x] Approximately 3,687
- [ ] Over 5,000
- [ ] Just 1,000
- [ ] More than 10,000
> **Explanation:** Currently, about 3,687 stocks are part of the FT Wilshire 5000 Index.
## When was the Wilshire 5000 rebranded as the FT Wilshire 5000 Index?
- [ ] January 1, 2020
- [x] June 30, 2021
- [ ] July 15, 2022
- [ ] December 31, 2019
> **Explanation:** The rebranding occurred on June 30, 2021, to reflect a new partnership.
## At its peak, how many stocks were included in the FT Wilshire 5000 Index?
- [x] Over 7,500
- [ ] Around 5,000
- [ ] 3,500
- [ ] Exactly 10,000
> **Explanation:** The index included over 7,500 stocks at its height.
## Which of the following is a feature of the FT Wilshire 5000 Index?
- [x] Represents a wide range of U.S. stocks
- [ ] Only covers high tech companies
- [ ] Focuses on international markets
- [ ] Exclusively tracks the top 100 stocks
> **Explanation:** The FT Wilshire 5000 Index represents nearly all publicly traded companies in the U.S.
## The original name of the FT Wilshire 5000 Index was?
- [x] Wilshire 5000 Total Market Index
- [ ] The U.S. Market Index
- [ ] The Big Stock Index
- [ ] The Tech Index
> **Explanation:** The index was originally called the Wilshire 5000 Total Market Index before its rebranding.
## What kind of investment would follow the FT Wilshire 5000 Index?
- [ ] A high-risk tech startup investment
- [ ] A DJ mixing multiple stock tracks
- [x] A diverse mutual fund
- [ ] A single real estate property
> **Explanation:** A fund that tracks this index would be a diverse mutual fund reflecting multiple stocks across sectors.
## What is the overarching goal of the FT Wilshire 5000 Index?
- [x] To provide a benchmark for U.S. stock market performance
- [ ] To promote stocks exclusively for small businesses
- [ ] To track only government bonds
- [ ] To market products not listed on any exchange
> **Explanation:** Its main goal is to serve as a benchmark for measuring U.S. equities' performance.
## Which organization manages the FT Wilshire 5000 Index?
- [ ] U.S. Treasury
- [ ] A group of stock market gamblers
- [x] Wilshire Associates
- [ ] A committee of unemployed mathematicians
> **Explanation:** The index is managed by Wilshire Associates, a prominent investment research company.
## What happens to the number of stocks in the FT Wilshire 5000 Index?
- [ ] It remains constant regardless of market fluctuations
- [ ] It can decrease if companies go out of business
- [x] It evolves based on the investable market
- [ ] It only increases over time without exceptions
> **Explanation:** The number of stocks in the index can fluctuate as companies are added or removed based on their investability.
Thank you for reading! Remember, the stock market may be serious biz, but there’s always room for a little fun and laughter while investing! Keep learning and do well! 🌟
