Each year, FTSE Russell recalibrates its U.S. indexes to ensure they accurately represent the evolving market. The Russell 1000 Index, comprising the largest 1,000 U.S. companies by market cap, saw some notable additions and exclusions in 2025.
Reconstitution: The Russell Index reconstitution ranks among the busiest trading days of the year, as asset managers rebalance portfolios to align with the updated index components.
This year's event set a new record when 2.5 billion shares changed hands in just 0.9 seconds, representing a staggering $102.4 billion in traded securities, according to Jeff Buchbinder, chief equity strategist at LPL Financial.
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Russell 1000 Additions: The Russell 1000 Index welcomed 37 new constituents in its latest reconstitution, with 19 companies promoted from the Russell 2000 Index, which includes the next 2,000 largest U.S. stocks.
The remaining 18 additions were primarily new entrants to the Russell Index family, with 17 of them joining for the first time, including two recent IPOs: SailPoint, Inc. (NASDAQ:SAIL) and Karman Holdings, Inc. (NYSE:KRMN).
Core Scientific, Inc. (CORZ), previously a micro-cap stock outside the Russell 3000, made an enormous leap directly into the Russell 1000.
Other Notable Russell 1000 Additions:
- Rivian Automotive, Inc. (NASDAQ:RIVN)
- Super Micro Computer, Inc. (NASDAQ:SMCI)
- DraftKings, Inc. (NASDAQ:DKNG)
- Roku, Inc. (NASDAQ:ROKU)
Notable Russell 1000 Exclusions:
- Nikola Corp. (NASDAQ:NKLA) (OTC:NKLAQ)
- Plug Power, Inc. (NASDAQ:PLUG)
- Beyond Meat, Inc. (NASDAQ:BYND)
- Lucid Group, Inc. (NASDAQ:LCID)
While Rivian was added to the Russell 1000 this year, other EV makers, Nikola and Lucid, were removed from the index. Green energy company Plug Power and Beyond Meat were also excluded.
Key Takeaway
While it is crucial to understand the Russell reconstitution and how sector indexes' compositions have changed, LPL Financial advises that the best course of action may be to "stay the course."
"For investors considering adjustments to their portfolios following these changes, we suggest staying patient while keeping in mind that volatility may pick up over the next few weeks around tariff headlines, incoming inflation data, the upcoming earnings season and historical seasonal weakness," Buchbinder said.
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