FTSE Russell Insights

Why we are separating Canada from the US within our global equity framework

Kathleen Dobyns

Kathleen Dobyns

Senior Manager, Product Management

Following a recent client consultation, which met with unanimous market support, FTSE Russell is separating Canada from the US as a new review region within the FTSE Global Equity Index Series (FTSE GEIS), our market-leading global equity benchmark. This change will take effect from the September 2025 index review. 

This change addresses the disproportionate influence of the US market on the representation of Canadian stocks within our global equity indices. Read on to find out more about why we are making this change.

How the FTSE GEIS is put together

One of the distinctive features of the FTSE GEIS is its “region-relative” approach to defining the size categories for stocks.

We rank stocks within each regional universe [Note1] by their full market capitalisation, then allocate them to capitalisation bands: broadly speaking, we define the top 70% within each regional universe as large caps, the next 20% as mid caps, the next 8% as small caps and the final 2% as micro caps[Note2].

How we handled Canadian stocks up to now within FTSE GEIS

Before the upcoming change to the review regions of FTSE GEIS, we treated Canada and the US as a single North American region. As of June 30, 2025, the US accounted for 94% of North America’s total market capitalisation, heavily influencing how companies in the region were ranked and then allocated to size bands. This imbalance made it difficult for Canadian companies to meet the size thresholds required for inclusion in the large- and -mid-cap tiers of FTSE GEIS.

By separating Canada from the US, FTSE Russell will now evaluate Canadian equities independently, in a similar way to how we separate the Japanese and Chinese equity markets from the broader Asia Pacific region within FTSE GEIS. The upcoming change will enable a more balanced and transparent view of Canada’s equity market, ensuring fairer representation in the FTSE Global Equity Index Series.

In the chart below, you can see how the introduction of Canada as a separate FTSE GEIS review region will boost the number of Canadian stocks in the FTSE Canada All Cap index (which includes large-, mid- and small-cap stocks), partially reversing a post-2012 decline in the number of index constituents.

FTSE Canada All Cap Index

chart shows the introduction of Canada as a separate FTSE GEIS review region will boost the number of Canadian stocks in the FTSE Canada All Cap index (which includes large-, mid- and small-cap stocks), partially reversing a post-2012 decline in the number of index constituents.

Source: FTSE Russell, data as of August 2025. September 2025 index review weights are calculated using data as of June 30, 2025. Past performance is no guarantee of future returns. Please see the end for important legal disclosures.

More accurate representation of size tiers

In the bar chart, we show how the re-segmentation of Canada within FTSE GEIS will lead to the more accurate classification of index constituents across the large-, mid- and small-cap size tiers.

FTSE Canada All Cap % Weight Breakdown

the bar chart, we show how the re-segmentation of Canada within FTSE GEIS will lead to the more accurate classification of index constituents across the large-, mid- and small-cap size tiers.

Source: FTSE Russell, data as of June 30, 2025. Past performance is no guarantee of future returns. Please see the end for important legal disclosures.

Effect on the FTSE Canada index (large and mid-cap stocks)

With effect from September 2025, the number of securities in the FTSE Canada index (which includes large- and mid-cap Canadian stocks) will increase from 47 to 78, accompanied by a 15% rise in the index’s net market capitalisation. The aggregate weight of these securities within the FTSE Canada All Cap index will also rise (from 79.5% to 88.9%), creating stronger global visibility for Canadian large- and mid-cap companies.

table display With effect from September 2025, the number of securities in the FTSE Canada index (which includes large- and mid-cap Canadian stocks) will increase from 47 to 78, accompanied by a 15% rise in the index’s net market capitalisation.
FTSE Canada All-World Index Current Index Semi-Annual Review Index
Number of constituents 47 78
Average 44,797 31,109
Largest company 186,071 186,071
Smallest company 6,730 5,008
Median 37,568 19,362
Weight of Largest Constituent (%)  8.84% (Royal Bank Of Canada) 7.67% (Royal Bank Of Canada)
Top 10 Holdings (% Index Mcap) 47.58% 41.28%
Weight in FTSE All-World Index 2.43% 2.80%

Source: FTSE Russell, data as of June 30, 2025. Semi-annual review index shows the effect on the current index of the forthcoming introduction of Canada as a separate FTSE GEIS review region. Past performance is no guarantee of future returns. Please see the end for important legal disclosures.

Effect on the FTSE Canada All Cap index (large-, mid- and small-cap stocks) 

With effect from September 2025, the membership of the FTSE Canada All Cap index (which includes large-, mid- and small-cap Canadian stocks) will increase from 154 to 204 securities, with a 3.08% increase in net market capitalisation, driven largely by the movement of 48 securities to the index from the micro-cap category.

table shows With effect from September 2025, the membership of the FTSE Canada All Cap index (which includes large-, mid- and small-cap Canadian stocks) will increase from 154 to 204 securities, with a 3.08% increase in net market capitalisation, driven largely by the movement of 48 securities to the index from the micro-cap category.
FTSE Canada All Cap Index Current Index Semi-Annual Review Index
Number of constituents 154 205
Average 17,203 13,387
Largest company 186,071 186,071
Smallest company 516 430
Median 5,634 3,801
Weight of Largest Constituent (%)  7.02% (Royal Bank Of Canada) 6.81% (Royal Bank Of Canada)
Top 10 Holdings (% Index Mcap) 37.81% 36.68%
Weight in FTSE All Cap Index 2.78% 2.85%

Source: FTSE Russell, data as of June 30, 2025. Semi-annual review index shows the effect on the current index of the forthcoming introduction of Canada as a separate FTSE GEIS review region. Past performance is no guarantee of future returns. Please see the end for important legal disclosures.

Effect on the FTSE Canada Total Cap index (large, mid-, small- and micro-cap stocks) 

The effect on this index, our broadest Canadian equity benchmark, covering large-, mid-, small- and micro-cap Canadian stocks) will be a rise in the number of securities from 466 to 480, with a modest 0.17% increase in net market capitalisation, reinforcing the depth of Canada’s equity universe.

table displays our broadest Canadian equity benchmark, covering large-, mid-, small- and micro-cap Canadian stocks) will be a rise in the number of securities from 466 to 480, with a modest 0.17% increase in net market capitalisation, reinforcing the depth of Canada’s equity universe.
FTSE Canada Total Cap Index Current Index Semi-Annual Review Index
Number of constituents 466 480
Average 6,034 5,864
Largest company 186,071 186,071
Smallest company 21 35
Median 595 546
Weight of Largest Constituent (%)  6.63% (Royal Bank Of Canada) 6.62% (Royal Bank Of Canada)
Top 10 Holdings (% Index Mcap) 35.70% 35.66%
Weight in FTSE Total Cap Index 2.89% 2.88%
Source: FTSE Russell, data as of June 30, 2025. Semi-annual review index shows the effect on the current index of the forthcoming introduction of Canada as a separate FTSE GEIS review region. Past performance is no guarantee of future returns. Please see the end for important legal disclosures.

Overall representation of Canada within FTSE GEIS

Despite these internal shifts, Canada’s overall weight within the FTSE GEIS universe will remain stable at around 2.8% of the total market capitalisation. In other words, the reclassification of Canada within FTSE GEIS will primarily impact how securities are distributed across capitalisation tiers, ensuring a more balanced view of Canadian equity markets.

Implementation in tranches

To help support market liquidity and to minimise index turnover, FTSE Russell will implement a phased inclusion approach for all the stocks that are eligible to join the FTSE Canada All Cap index at the September 2025 review. This will affect companies moving up from the FTSE Canada Micro Cap index to the FTSE Canada All Cap index, as well as other newly eligible securities.

In total, 51 companies will be eligible for the FTSE Canada All Cap Index as at September 2025:

  • 48 companies promoted from the FTSE Canada Micro Cap index
  • 3 companies newly entering the FTSE Canada equity universe

These additions will be added to the FTSE Canada All Cap index in tranches (with each security's inclusion based on a percentage of its investability weight) over the next three quarterly index reviews, as follows:

this table displays the the FTSE Canada All Cap index in tranches
Index Impacted Securities September 2025​ December 2025​ March 2026​
FTSE Canada All Cap Index September 2025 Semi-Annual Review New Additions 35% 65% 100%

Source: FTSE Russell. Past performance is no guarantee of future returns. Please see the end for important legal disclosures.

Conclusion

The separation of Canada and the US as review regions within our main global equity benchmark, the FTSE GEIS, marks a pivotal step toward the fairer and more proportional representation of Canadian equities. It reflects the evolving nature of global markets and the growing importance of regional nuance. For Canada, this means clearer visibility, a stronger alignment with global peers and a more accurate reflection of its market within the FTSE Global Equity Index Series.

Sources

[1] With effect from September 2025, there are nine universes within the FTSE GEIS: Asia Pacific ex China ex Japan; Canada; China; Developed Europe; Emerging Europe; Japan; Latin America; Middle East and Africa; USA. | Back to Note 1

[2] These bands are not set in stone, since stocks change continuously in market capitalisation and our index reviews are only periodic. And at our regular index reviews stocks do not move automatically between capitalisation bands once they cross these thresholds: they do so only after crossing “buffer zones”, which are meant to reduce internal index turnover. See the index ground rules for more detail. | Back to Note 2

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