- Reconstitution of Russell US Indexes will be held semi-annually in June and November from 2026
- Decision based on data analysis and market consultation undertaken in response to the recent evolution of market dynamics and increased volatility
- Moving Russell US Indexes to a semi-annual reconstitution frequency supports index goals of maintaining accurate representation of the US equity market and ensuring practical usability of the indexes
FTSE Russell, the global index provider, today announces that the Russell US Indexes reconstitution will move to a semi-annual frequency in 2026, with rebalancing continuing on the fourth Friday in June and with the additional implementation date of the second Friday in November.
Russell US Indexes are currently reconstituted annually in June and based on more recent market dynamics and increased volatility, FTSE Russell explored the impact of reconstituting the Russell US Indexes semi-annually. Based on this evaluation, FTSE Russell announces the decision to add a semi-annual Russell US Indexes reconstitution on the second Friday of November, beginning November 2026, contingent on a successful parallel test run in November 2025.
Commenting on moving the Russell US Indexes to a semi-annual reconstitution, Catherine Yoshimoto, Director, Product Management of FTSE Russell, said:
“Since their inception, regular reconstitutions have been a critical part of maintaining the Russell US Indexes by accurately reflecting the ever-changing US equity market. With increased volatility within US equity markets over the past five years, compared to the prior fifteen years, moving to a semi-annual Russell reconstitution frequency to update membership changes earlier will enable greater alignment with the dynamic changes in the current market environment.”
Proposed semi-annual reconstitution methodology overview:
- The November semi-annual reconstitution will apply the Russell US Indexes construction rules across the size indexes such as the Russell 1000® and Russell 2000® Indexes, however Russell US Style Index changes will be made only to new additions or membership movements (such as for a stock moving from the Russell 1000 Index to the Russell 2000 Index and vice versa) due to the higher projected turnover of Growth and Value Style changes (Russell US Style Indexes will continue to be rebalanced completely in June).
- The quarterly December IPO inclusion and float/share changes will be incorporated into the November semi-annual Russell reconstitution.
- Derived indices, e.g. Russell factor indices, which currently rebalance in December, will also be rebalanced in November.
- The non-Russell, FTSE equity indices will continue with their quarterly December reviews, however cut-off dates will be aligned with those of the Russell US Indexes semi-annual reconstitution in November.
Fiona Bassett, CEO of FTSE Russell, said:
“The annual Russell reconstitution in June is a major event within the US equity market, however, it is important to ensure the Russell US Indexes – which recently celebrated its 41st anniversary – continue to evolve to reflect the dynamic US economy. One of the most attractive features of the Russell US Indexes is that they are designed to represent the US equity market objectively in terms of capitalization and style. Moving to a semi-annual reconstitution frequency will ensure that the Russell US Indexes continue to represent the market, while maintaining the fundamental purpose of the index as a practical portfolio benchmark.”
As adoption of the Russell US Indexes has grown, so has the size of the trade at the annual Russell reconstitution. Since 2019, the dollar amount traded at the close of Russell reconstitution day across Nasdaq and NYSE exchanges has exceeded $100 billion; at market close of the June 2024 reconstitution $219.6 billion was traded.
Approximately $10.6 trillion in assets were benchmarked (by both active and passive funds) to the Russell US Indexes (including growth and value) as of the end of December 2023. Of this total AUM, approximately $2 trillion of the assets were passive, and ETF assets tracking a Russell US index (including styles, sectors, factors, etc.) stood at $658 billion as of the end of September 2024.
At launch in 1984, the Russell US Indexes were reconstituted quarterly, then semi-annually from 1987, and then annually from June 1989 onwards. Balancing representation and turnover have always been key considerations in determining the appropriate frequency of the Russell US Indexes reconstitution.
View the technical notice here.
About FTSE Russell, an LSEG business:
FTSE Russell is a global index leader that provides innovative benchmarking, analytics and data solutions for investors worldwide. FTSE Russell calculates thousands of indexes that measure and benchmark markets and asset classes in more than 70 countries, covering 98% of the investable market globally.
FTSE Russell index expertise and products are used extensively by institutional and retail investors globally. Approximately $15.9 trillion is benchmarked to FTSE Russell indexes. Leading asset owners, asset managers, ETF providers and investment banks choose FTSE Russell indexes to benchmark their investment performance and create ETFs, structured products and index-based derivatives.
A core set of universal principles guides FTSE Russell index design and management: a transparent rules-based methodology is informed by independent committees of leading market participants. FTSE Russell is focused on applying the highest industry standards in index design and governance and embraces the IOSCO Principles. FTSE Russell is also focused on index innovation and customer partnerships as it seeks to enhance the breadth, depth and reach of its offering.
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