The index selects companies based on fundamental analysis criteria such as Return on investment, growth, market value, profits and cash flow.
[5] The index was first published in Barron's on September 3, 2007, and was the subject of the magazine's cover story on that date.
[6] The B400 hit an all-time closing high of 451.40 on July 22, 2013 during an extended broader bull market that commenced in March, 2009.
An updated chart of the B400 has appeared in The Trader section of Barron's magazine since the index's inception.
[10] It also analyzes a company according to its growth trajectory, whether its stock is cheap or expensive relative to the company's underlying fundamentals, its profit margins, leverage, return on shareholder equity, and the way it grows and manages the cash it generates from operations.
The selection process also measure a stock's reaction to the latest earnings reports and the degree to which it may be overlooked by analysts.
Each stock selected for the B400 must have a minimum three-month average daily dollar-trading volume of $2 million.
The result prevents a small minority of huge companies from steering the index, while giving smaller issues equal opportunity to contribute to the B400's overall performance.
[11] The companies with the most selections in the B400 since its 1997 inception are Microsoft Corp., Wal-Mart Stores, Inc., Amgen Inc., Bed Bath & Beyond Inc., The Home Depot, Inc., International Business Machines, NIKE Inc., Oracle Corporation, PepsiCo Inc. and Apollo Group Inc.
[13] The Barron's 400 Index is managed by MarketGrader, led by Founder Carlos Diez, who founded the stock research firm in 1999.
In May, 2013, MarketGrader named former Dow Jones Indexes executive John Prestbo as a senior adviser for the growth and development of the B400.