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Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

S&P Europe 350 Index

What it is:

The S&P Europe 350 index is made up of 350 individual European company stocks drawn from 17 major European markets and represents approximately 70% of the region's market capitalization.

How it works (Example):

The S&P Europe 350 index is comprised of the S&P Euro, the S&P Euro Plus, and the S&P United Kingdom. The index joins the S&P 500 and five other regional indices to make up the S&P Global 1200 index.

To be included in the S&P Europe 350 index, a company must meet certain criteria, including: market capitalization (size must be in the top 95th percentile), public float (who holds the stock), liquidity, domicile, type of securities (stocks and preferred stocks are generally eligible), and sector classification.

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A company can be removed from the S&P Europe 350 index if it no longer meets these criteria. In addition, if a company changes enough through M&A activity or restructuring to no longer meet the criteria, it will be considered ineligible to remain on the index and be removed.

Why it Matters:

Similar to the S&P 500 index in the United States, the S&P Europe 350 index can be used as a benchmark to measure a European stock's performance.  Investors may consider investing in an index fund or ETF that mirrors the S&P Europe 350 index performance as a way to regionally diversify their portfolio. There are several ETFs available that mirror the S&P Europe 350 index, including the iShares S&P Europe 350 Index (AMEX: IEV). Bloomberg tracks the index under the ticker SPE:IND.

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