How Russell Index Changes Impact ETFs

Popular ETFs such as ‘IWM’ and ‘IWF’ are updating their portfolio mix to reflect index changes.

Reviewed by: Cinthia Murphy
Edited by: Cinthia Murphy

Global index provider FTSE Russell just completed its annual reconstitution of key Russell indices, adjusting their mix to reflect changes in companies’ size as determined by market capitalization as well as style fit over the previous year.

In a recap of the main trends seen in this year’s reconstitution, the index provider noted that the total market cap of the Russell 3000 grew some 13% to a record $27.2 trillion, primarily due to market performance. The U.S. equity market has gotten bigger.

Higher Large/Small-Cap Breakpoint

Along with that came a higher “breakpoint” between large- and small-cap stocks, now at $3.4 billion, up from $2.9 billion just a year ago.

Among the names highlighted in this year’s U.S. index reconstitution was Apple, which again was the largest company in the Russell 3000 Index, five years running. The tech giant is also now considered a 100% growth stock, a change from its year-earlier style split as 92% growth/8% value.

J.P. Morgan rose to be among the 10 largest U.S. companies, while Facebook and Amazon cemented their ranks among the biggest names in the U.S. market somewhat at the expense of ExxonMobil, which moved down a notch.

The Russell 1000 Index, capturing U.S. large-cap stocks, added 41 names and lost 44, including the likes of JCPenney, Fitbit and Yelp. 

In the small-cap space, as represented by the Russell 2000, some 228 companies were added to the benchmark, many in the financial and banking sector as well as health care names, particularly biotech. Names like Hertz, Dillard’s, Avis Budget Group and Frontier Communications joined the index. A total of 137 stocks left the mix, either moving up to the Russell 1000, or down to the micro-cap space. 


ETF Impact

These annual changes impact a roster of ETFs built around Russell indices, which then must buy or sell underlying stocks in order to track their benchmarks. The whole reconstitution process takes place throughout the month of June in an annual event that’s rolled out in three parts. 

Today there is more than $110 billion in U.S.-listed ETF assets linked to four U.S. equity Russell indices, the bulk of the assets being dominated by one issuer: iShares.

Among the biggest Russell-linked ETFs, all offered by iShares—are funds such as the $7.7 billion iShares Russell 3000 ETF (IWV), the $39 billion iShares Russell 2000 ETF (IWM), the $18.5 billion iShares Russell 1000 ETF (IWB) and the $36.2 billion iShares Russell 1000 Growth ETF (IWF).

Other ETFs impacted by the reconstitution include:

For a full list of company additions and deletions, check out Russell’s full reconstitution report

Contact Cinthia Murphy at [email protected]


Cinthia Murphy is head of digital experience, advocating for the user in all that does. She previously served as managing editor and writer for, specializing in ETF content and multimedia. Cinthia’s experience includes time at Dow Jones and former BridgeNews, covering commodity futures markets in Chicago and Brazil equities in Sao Paulo. She has a bachelor’s degree in journalism from the University of Missouri-Columbia.