The first noteworthy trend is the performance of small caps relative to large caps. As of the 10 months ended April 2017, both US small cap style indexes—the Russell 2000 Value and Russell 2000 Growth—outperformed their large cap counterparts. However, for the same period the following year (July 2017 – April 2018), the Russell 2000 Growth Index underperformed its large cap counterpart, while the Russell 2000 Value Index performed in-line with the Russell 1000 Value Index.
Style performance was another point of interest. As of the 10 months ended April 2018, both large and small cap growth indexes—the Russell 1000 Growth and Russell 2000 Growth—outperformed their value counterparts. For the same period the prior year, small cap value outperformed small cap growth, while the reverse was true for large caps.
These trends demonstrate how markets shift from year-to-year, and the Russell US Index reconstitution reflects these changes by refreshing index constituent membership. As you can see below, the dividing line between large cap and small cap companies (breakpoint) changes from year-to-year—more significantly in some years, such as in 2009 at the tail end of the Global Financial Crisis—and the breakpoint has served as an indicator of market growth (or decline). Moreover, with $8.5 trillion in benchmarked assets tracking the Russell US Indexes, including the large cap Russell 1000 and small cap Russell 2000 Indexes, the annual Russell US Index reconstitution is a widely followed event.
As ever-changing market conditions are shaping index composition, it’s important for investors to have the precise tools needed to target their desired outcomes. FTSE Russell provides investors with a modular set of indexes that can be used to track the US equity market, and we continue to expand our Russell US Index offerings. In 2018, Russell US Indexes were enhanced with the addition of the Russell Top 500 Index, which includes the largest 500 companies by market capitalization in the US equity market, and complements the SMID cap Russell 2500 Index for market participants who wish to divide the US equity market at the 500th stock.
For additional information about the Russell US Indexes, see: http://www.ftse.com/products/indices/russell-us
 Data as of December 31, 2016, as reported on March 31, 2017 by eVestment for institutional assets, Morningstar for retail mutual funds, insurance products, and ETFs, and additional passive assets directly collected by FTSE Russell. AUM data includes blended benchmarks and excludes futures and options. Passive assets directly collected by FTSE Russell have been removed from third party sources to prevent double counting. No assurances are given by FTSE Russell as to the accuracy of the data.
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