Wilshire 5000 Total Market Index (TMWX)
Candlefocus EditorThe index is maintained and published by Wilshire Associates, a U.S. investment firm. It is traditionally used as the primary measure of the U.S. stock market performance. The TMWX includes investments from large and small companies, making it a great indicator of overall performance in the market. All of the stocks in this index are combined based on their market capitalization. This means that the larger companies are weighted more heavily while the smaller companies are only included as a small portion of the overall index.
The FT Wilshire 5000 Index is a variation of the Wilshire 5000 Total Market Index. The FT Wilshire 5000 Index was created after the Wilshire Associates began to streamline the TMWX index by removing stocks that had low liquidity or whose market capitalization dropped below a certain threshold. This left the FT Wilshire 5000 Index with only 3,687 stocks compared to its high point of 7,500.
Despite this change in number of stocks, the FT Wilshire 5000 Index still seek to capture the same amount of market investible U.S. market capitalization as the TMWX. As such, it remains an important gauge of performance for the U.S. stock market and provides insight into how the market is performing overall.
In conclusion, the Wilshire 5000 Total Market Index and the FT Wilshire 5000 Index provide a comprehensive way to measure the performance of the U.S. stock market. While the number of stocks in the FTW5000 is much lower in comparison to TMWX, the indexes remain highly correlated and FT Wilshire 5000 Index is a good representation of the U.S. stock market performance.