What is the Russell 2500 index’
The Russell 2500 index is a broad measure that includes 2,500 shares that cover the small and mid-cap market capitalization. The Russell 2500 is a market cap weighted index that includes the smallest 2,500 companies in the Russell 3000 Universe in the United States stock.
Breaking down the ‘Russell 2500 index’
The Russell 2500 is intended for a wide and impartial in their criteria and annually recompiled with the inevitable changes that occur as shares rise and fall in price. The merging of small and mid-cap shares sometimes referred to as “SMID” cap, and can describe any company on the market is $ 10 billion range cap. These companies generally are considered more growth than large-cap companies and may experience higher volatility than the second longer-term periods.
How companies choose for inclusion in the Russell 2500
Started on 1 July 1995, the companies selected for inclusion in the Russell 2500 index chosen based on float-adjusted market capitalization. On the last trading day of may of each year, FSTE Russell enviable ranks companies based on total market capitalization, and the last Friday of June of each year the index is reproduced. To be eligible for inclusion in the Russell 2500 index, a security must trade on the NYSE, Ticker NYSE mkt, Nasdaq or ARCA exchanges. The index is monitored through Ticker R25IV.
The Russell 2500 index includes approximately 2,500 of the smallest securities based on a combination of their market capitalization and current index composition. Companies included in the index usually come from the financial services durable goods producer and the mining industry. Component companies and the industry composition of the index may change over time.
Investing in the Russell 2500 index
Those who wish to invest in the overall performance of the Russell 2500 invests in the ishares Russell small/mid-cap index Fund that aims to track the performance of the Russell 2500 index.
Blackrock uses a representative strategy index sampling for the management of the Fund. “Representative sampling” is an indexing strategy that seeks to invest in a representative sample of securities that mimics the investment profile of the underlying index the Russell 2500. The Fund normally invests at least 90 percent of their assets in securities of the underlying index. Certain securities, as expected, in the aggregate, investment characteristics (based on factors such as market capitalization and industry weights), fundamental characteristics (such as return variability and yield) and liquidity measures similar to the underlying index. The Fund may or may not hold all the securities in the underlying index.