ER2 will be reconstituted on June 24
Annual Process Keeps Benchmarks Tuned to Market Reality
June 10, 2005 — Russell Investment Group has posted its preliminary lists of companies that will join or leave the broad-market Russell 3000® Index when Russell's family of U.S. equity indexes is reconstituted June 24. Russell also posted a preliminary membership list for the new Russell Microcap™ Index.
Today's "additions" list for the Russell 3000 indicates 208 companies will move into the index — fewer than last year's 323 companies and far less than the 10-year average of 455.
"We see fewer additions in 2005 in large part because Russell enhanced the ability of our indexes to reflect the market by adding eligible IPOs each quarter since September," said Lori Richards, senior product manager for Russell indexes.
Over the course of the year the Russell 3000 made room for a total of 159 IPOs, including 28 as part of the reconstitution process this quarter. The number of IPOs added to the index this year increased notably from last year when 95 IPOs were added and dramatically from 2003 when only 28 IPOs flowed into the index.
Russell's index reconstitution process is followed closely by many investors because the Russell indexes currently have $2.5 trillion in assets benchmarked to them.