Russell 2500 Index

What Is the Russell 2500 Index?

The Russell 2500 is a market-cap-weighted index that incorporates the smallest 2,500 companies covered in the broad-based Russell 3000 circle of United States-based listed equities. Every one of the 2,500 of the companies remembered for the Index cover the small-and mid-cap market capitalizations.

Grasping the Russell 2500 Index

The Russell 2500 Index is intended to be broad and fair-minded in its inclusion criteria, and it is recompiled every year to account for the unavoidable changes that happen as stocks rise and fall in value. The space covered by the mixing of small-and mid-cap stocks are some of the time alluded to as "smid" cap; it can depict any company up to the $10 billion market cap range. These companies are generally viewed as more growth-arranged than enormous cap stocks and may experience more volatility than the last option over long-term periods.

To invest in the Russel 2500, pick a mutual index fund that tracks the index, like the iShares Russell Small/Mid-Cap Index Fund or the iShares Russell 2500 ETF.

How Companies Are Chosen for Inclusion in the Russell 2500

Sent off on July 1, 1995, companies chose for inclusion in the Russell 2500 Index are picked based on float-adjusted market capitalization. On the last trading day of May of every year, FSTE Russell positions eligible companies based on their total market capitalization values, and on the last Friday of June of every year, the index is reconstituted. To be eligible for inclusion in the Russell 2500 Index, a security must trade on the NYSE, NYSE American, NASDAQ, or ARCA exchanges. The index is monitored by means of the ticker symbol R25I.

The Russell 2500 Index comprises roughly 2,500 of the smallest securities, based on a combination of their market cap and current index participation. Companies remembered for the index generally come from financial services, producer durables, and consumer discretionary industries. The part companies and the industry piece of the index are subject to change over the long haul.

Investing in the Russell 2500 Index

The people who wish to invest in the overall performance of the Russell 2500 Index might invest in the iShares Russell Small/Mid-Cap Index Fund, which looks to follow the performance of the Russell 2500 Index.

BlackRock utilizes a representative sampling indexing strategy to deal with the Fund. Representative sampling is an indexing strategy that tries to invest in a representative sample of securities that mirrors the investment profile of the underlying Russell 2500 Index. The fund generally invests somewhere around 90% of its assets in the securities of the underlying index. The securities chose are expected to have, in the aggregate, investment qualities (based on factors like market capitalization and industry weightings), fundamental attributes, (for example, return variability and yield), and liquidity measures like those of the underlying index. The fund might hold every one of the securities in the underlying index.

Other Russell Indices

FTSE Russell keeps several other well known indices, including the accompanying:

• Russell 3000: The index tracks the performance of the 3,000 biggest U.S.- traded stocks which address around 98% of all U.S incorporated equity securities.
• Russell 3000 Value: Included in the Russell 3000 Value Index are stocks from the Russell 3000 Index with lower price-to-book ratios and lower expected growth rates.
• Russell 3000 Growth: incorporates companies that display indications of better than expected growth. The index is utilized to give a measure of the performance of growth stocks in the United States.
• Russell 2000: measuring the performance of roughly 2,000 smallest-cap American companies in the Russell 3000 Index.
• Russell 1000: a subset of the Russell 3000 Index, addresses the 1000 top companies by market capitalization in the United States.
• Russell Top 200: an index of the biggest 200 companies in the Russell 3000 index.
• Russell Top 50: index of the 50 biggest stocks in the Russell 3000 universe of U.S.- based equities.

Features

• The Russell 2500 comprises of the smallest, by market capitalization, of the 3,000 stocks in the Russell 3000.
• The Russell 2500 Index is a broad, market-cap-weighted stock market index highlighting 2,500 small-cap and mid-cap stocks.
• The stocks listed are all U.S. companies and vigorously favor names in the financial services, producer durables, and consumer discretionary sectors.