By Julia Quinn
To understand the function and purpose of the KGM 500, let’s first look to the more widely-used S&P 500.
The S&P 500 is a stock market index that tracks the performance of 500 large publicly traded companies in the U.S. It represents a broad cross-section of the U.S. economy and is considered a key indicator of overall market performance. Companies are selected based on factors like market capitalization, liquidity, and industry representation, and the S&P 500 is widely used by investors to gauge the health of the stock market.
With the KGM 500 we sought to create a similar trend line that gives us a bird’s-eye view of the overall health of the Broadway market, one that is uncoupled from bursts of downward or upward momentum on the grosses from one, or a handful, of outliers in any given week.
For our index, KGM selects 5 of the largest, longest-running musicals on Broadway and averages their grosses each week, separate from the combined weekly totals of all shows playing on Broadway. By focusing on these legacy shows, we intentionally remove variables (Tony nominations, press, reviews, etc.) that typically affect newer shows.
Our selection also removes shows that pulse in star casting at irregular intervals, as well as shows that may be buoyed by a movie release, as these factors can mask overall industry trends.
In this more focused view of sales trends, the KGM 500 helps us more clearly visualize to what extent audiences were wanting to attend theatre in a given week.
It also helps us easily spot which shows are out or underperforming the trend line.
Just as the S&P 500 is an invaluable tool for investors and analysts, the KGM 500 serves as a baseline for tracking the health of the Broadway market over time while removing irregular bursts of activity.
Whether you’re a lead producer, general manager, or simply a curious observer, keeping an eye on this index can provide a broad sense of the health of the New York theater market.
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