Investable weight factor
Market basicsAlso called: IWF, Free-float factor
The proportion of a company’s shares an index treats as publicly available, used to scale its contribution to a free-float weighted index.
In plain terms
In a market with large promoter holdings this can be a small fraction, so a company’s index weight is often far below what its market capitalisation suggests. The company is big; the part the index counts is not.