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How the S&P and Nasdaq are just like college football

Drake Johnson #20 of the Michigan Wolverines runs with the ball against the Ohio State Buckeyes at Ohio Stadium on November 29, 2014 in Columbus, Ohio. Ohio State defeated Michigan 42-28.
Jamie Sabau | Getty Images
Drake Johnson #20 of the Michigan Wolverines runs with the ball against the Ohio State Buckeyes at Ohio Stadium on November 29, 2014 in Columbus, Ohio. Ohio State defeated Michigan 42-28.

The Big Ten conference in college sports has 14 teams. Not 10.

The Big 12 conference has 10. Not 12.

As such, if some of the most prestigious colleges that play America's most popular sport can't figure out how to correctly count and name themselves, then why should the most famous stock indexes in the world's largest marketplace do so either?

That S&P 500 index? It has 505 stocks.

The Nasdaq 100? It has 109.

The Wilshire 5000? Well, it's anything but 5,000.

The news last week that the S&P 500 would increase up to 505 names caused us here at the Big Crunch to wonder if any other index was off the mark. Turns out, a lot of them are.

Index
Number of stocks
S&P 500 505
NASDAQ 100 109
Nikkei 225 225
Russell 2000 1967
Russell 3000 2999
FTSE 100 101
FTSE 250 250
FTSE 350 351
CAC 40 40
IBEX 35 35
CSI 300 289
S&P/ASX 200 200

Yes, the S&P 500 has 500 companies, but 505 stocks, because some of the stocks have dual share classes (like in Google's case, where one share class has different voting rights than the other).

"We're emulating the market more precisely," Howard Silverblatt, senior index analyst for S&P Dow Jones Indices, said earlier this year. "These different classifications of stock trade differently, thus have different results, giving a better representation of the market."

It all started with the two classes of Google stock. "When we added Google, we told systems not to code it 501," Silverblatt said, adding that they'd "regret it." That's when the 500 name and the 500 number diverged. And it hasn't come back since.

The Nasdaq 100 is similarly numerically challenged. It has 109 members, including doubles for Google, Comcast, Discovery, and eight different stocks that start with the word "Liberty".

Most interesting is the Wilshire 5000, which makes the other indexes seem "pretty close" in comparison. As of the end of 2014, it had 3,827 stocks, far from its high of 7,562 in 1992 and low near 3,069 in 1971.

The "5,000 was made part of the name to convey the breath of the index's coverage," according to company documents.

The Dow Jones industrial average itself, although often called the "Dow 30" as a shorthand, has never had a number as part of its name. Originally it had only 12 stocks but grew gradually in the past century.

Like college sports conferences, so many of these index names are artifacts of history and don't actually reflect the true reality. The S&P 500, for example, could live up to its name just by losing five smaller companies.

It is the Big Ten of stock indexes, where the number is only a reminder of things that used to be. When a number meant something.