Catherine Yoshimoto
Laura Brantley
Since their inception, regular reconstitutions have been essential to ensuring that the Russell US Indexes accurately reflect the continually evolving US equity markets. When the Russell US Indexes launched in 1984, they were reconstituted multiple times a year, before moving to an annual reconstitution schedule in 1989.
With the growth of assets tracking the Russell Indexes—approximately $11.8 trillion in assets benchmarked as of the end of 2024[1]—and the size of the trade at the annual reconstitution in June (exceeding $200 billion in 2024 and 2025[2]), FTSE Russell has received clear feedback from market participants highlighting the need for a more regular and responsive approach to index reconstitution. In January 2025, FTSE Russell announced the intention to move to a semi-annual reconstitution frequency in 2026, contingent upon a successful parallel run in Q4 2025.
FTSE Russell successfully completed a parallel run of the Russell US Indexes semi-annual reconstitution process in November 2025, confirming operational readiness, validating methodology integrity, and demonstrating minimal impact on index characteristics. This was a critical and deciding step toward the official transition to a semi-annual reconstitution schedule in December 2026.
The parallel run highlighted several key takeaways. Turnover and composition changes aligned with expectations, demonstrating that semi-annual reconstitution will reflect market developments while maintaining overall index composition and integrity. Russell US Style Indexes turnover remained well below June 2025 levels, reinforcing the decision to limit December style index changes to new additions and size-driven membership movements.
Operational systems, controls, and data processes functioned smoothly, establishing readiness for an effective date on the second Friday in December—a change from the previously announced effective date of second Friday in November, based on market feedback indicating sufficient liquidity on the December date.
Overall, the parallel run provides clear evidence that the semi‑annual schedule can be implemented without disrupting methodology integrity or index behavior.
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[1] Data as of December 31, 2024 as reported on May 15, 2025 by eVestment for active institutional funds, Morningstar for active retail mutual funds, insurance products, and ETFs, and passive assets directly collected by FTSE Russell. AUM includes blended benchmarks and excludes futures and options. AUM data does not include active and passive assets not reported to a 3rd party source or FTSE Russell. For funds where the AUM was not reported as of December 31, 2024, the previous period AUM was used as an estimate. No assurances are given by FTSE Russell as to the accuracy of the data.
