Russell 2000: The Small-Cap Index, Measured Against the S&P 500 Since 1987
The Russell 2000 is FTSE Russell's index of small US companies: roughly the 2,000 stocks that rank below the largest 1,000 in the Russell 3000. On the 30 Apr 2026 rank day it held 1,996 companies, and FTSE Russell put its size range, before banding, at $146.4 million to $5.7 billion.
When people say small caps rallied, they almost always mean the Russell 2000 went up. It is the default yardstick for smaller US companies, and a large pool of fund money tracks it. What it holds, how that list is chosen, and how it has behaved beside the S&P 500 are three separate questions, and this page answers each one from FTSE Russell’s own figures and 39 years of daily closes.
How it works
Start with the Russell 3000. FTSE Russell ranks every eligible US company by its total market value on a single day, called rank day. The biggest roughly 3,000 form the Russell 3000, which held 3,023 securities on the 2026 rank day.
Split that list in two. The top of the ranking becomes the Russell 1000, the large-cap index. The rest become the Russell 2000. In 2026 the split came out at 1,027 names above the line and 1,996 below it, which is why the index rarely holds exactly 2,000 stocks.
Weight by the shares the public can trade. Inside the index each company counts in proportion to its float-adjusted market value, so a $5 billion company moves the index far more than a $200 million one. It is still a small-company index, but it leans toward the larger end of its own range.
Eligibility comes before size. FTSE Russell’s press release on the June 2026 rebuild lists voting rights, US nationality rules and eligible security types among the tests a company must pass before its size is even considered.
Two numbers get quoted, and they differ. The ^RUT figure on most charts is a price index; it ignores dividends. Funds that track it pay those dividends out, so their total return runs a little ahead of the chart.
How membership is decided
The breakpoint moves every year. On the 30 Apr 2026 rank day, the line between the Russell 1000 and the Russell 2000 sat at about $5.7 billion, up 24% from a year earlier, according to FTSE Russell. Before banding, the smallest member of the Russell 2000 was worth $146.4 million and the median member $1.1 billion, against a Russell 1000 median of $17.4 billion.
Banding stops companies flipping back and forth. FTSE Russell does not move a company across the line the moment it crosses it. It uses a cumulative 2.5% market-cap percentile range either side of the breakpoint, and an existing member inside that range stays where it is. In 2026 that let a Russell 2000 member stay put up to $9.6 billion, and a Russell 1000 member stay put down to $2.7 billion.
Graduates leave. The June 2026 preliminary lists showed 43 companies moving up from the Russell 2000 into the Russell 1000 and 37 moving down the other way. The small-cap index therefore sheds its biggest winners at each rebuild and takes in the large companies that have shrunk.
Reconstitution, now twice a year
For decades the rebuild ran once a year, in June. FTSE Russell announced in January 2025 that the Russell US indexes would move to a semi-annual schedule from 2026. The December 2026 rebuild is, in the index provider’s words, the first December reconstitution in more than three decades.
The June 2026 changes took effect after the close on Friday 26 Jun 2026, with the new membership live from the open on Monday 29 Jun.
The December 2026 timetable, as published on 1 Sep 2026:
- Rank day, Friday 30 Oct: eligibility and market values fixed at the close.
- Preliminary lists, Friday 13 Nov: additions and deletions published after the close.
- Query period, 16 to 27 Nov, then lockdown from Monday 30 Nov.
- Effective after the close on Friday 11 Dec; markets open on the new lists on Monday 14 Dec.
Rebuild day is one of the heaviest trading days of the year. FTSE Russell reports $219.9 billion traded on the NYSE and $334.0 billion on Nasdaq in the closing moments of the June 2026 rebuild day.
A worked example
Take three hypothetical companies on the 30 Apr 2026 rank day, using FTSE Russell’s published 2026 cut-offs.
- Company A, worth $7.0 billion, already in the Russell 2000. It is above the $5.7 billion breakpoint, but below the $9.6 billion upper edge of the banding range, so it stays in the small-cap index.
- Company B, worth $10.0 billion, already in the Russell 2000. That is above $9.6 billion, so it moves up to the Russell 1000 and leaves the small-cap index after the close on 26 Jun.
- Company C, worth $3.0 billion, already in the Russell 1000. It is below the breakpoint, but above the $2.7 billion lower edge, so it stays a large-cap member for now.
The same $7.0 billion would have been a clear large cap in 2020, when the breakpoint was $3.0 billion and banding kept Russell 2000 members only up to $4.4 billion. A company that did not change at all could sit in either index depending only on the year.
Scale sets the rest in proportion. FTSE Russell puts the combined value of the Russell 2000 at $3.5 trillion on the 2026 rank day, against $75.6 trillion for the Russell 3000. The entire small-cap index was about 4.6% of the investable US market, while Nvidia alone was valued at $4,849.6 billion.
The original data
The first set is FTSE Russell’s own history of the cut-off. The index provider publishes the largest and smallest Russell 2000 member at each June rebuild back to 2009, before and after banding. Before banding, the largest is the breakpoint itself, and it has moved from $1.2 billion in 2009 to $5.7 billion in 2026, and it has not moved in a straight line: $3.7 billion in 2018, $3.0 billion in 2020, $5.2 billion in 2021, $4.2 billion in 2023, and $4.6 billion in 2022, 2024 and 2025. Year by year from 2009, in billions of dollars, it read 1.2, 1.7, 2.2, 2.0, 2.6, 3.1, 3.4, 2.9, 3.4, 3.7, 3.6, 3.0, 5.2, 4.6, 4.2, 4.6, 4.6 and 5.7. The smallest member ranged from $78.3 million in 2009 to $257.1 million in 2021, and was $146.4 million in 2026. The full table is in a CSV of Russell 2000 size ranges since 2009.
The line follows the market, not a rule. In 2020 rank day came weeks after the spring crash, and the cut-off dropped to $3.0 billion. A year later it was $5.2 billion. The definition of small is always the market’s own ranking on one day, so a sharp rally or a sharp fall before rank day changes which companies count as small. That is worth remembering when two years of the index are compared: the list of companies inside it is not the same list. The cut-off in 2026 was nearly five times the 2009 figure.
The second set is 39 years of daily closes. Yahoo Finance carries the Russell 2000 price index, ^RUT, from 10 Sep 1987. On that day it closed at 168.97 and the S&P 500 at 317.13. On 25 Sep 2026 they closed at 2,837.55 and 7,743.41. Both figures are price only, so neither counts dividends.
- Price multiple since 10 Sep 1987: Russell 2000 16.8 times, S&P 500 24.4 times.
- Full calendar years ahead, 1988 to 2025: the Russell 2000 finished ahead in 19 of 38, the S&P 500 in the other 19.
- Worst fall from a record close: Russell 2000 -59.9% (13 Jul 2007 to 9 Mar 2009), S&P 500 -56.8% (9 Oct 2007 to 9 Mar 2009).
- Annualized volatility of daily closes over the last ten years: 23.5% against 18.1%.
- Longest wait for a new record close: 1,488 days for the Russell 2000 (9 Mar 2000 to 5 Apr 2004), 2,623 days for the S&P 500 (24 Mar 2000 to 30 May 2007).
The recent record gap is the one most readers lived through. The Russell 2000 closed at 2,442.74 on 8 Nov 2021 and did not close higher until 18 Sep 2025, at 2,467.70. That was 1,410 days, and in 2024 alone the S&P 500 made 57 record closes. The index then set a new record close of 3,068.42 on 14 Aug 2026 and finished 25 Sep 2026 7.5% below it. Every year’s closes are in a CSV of Russell 2000 and S&P 500 calendar years, and the summary rows in a CSV of the comparison.
The streaks are what make the long average misleading. The Russell 2000 finished ahead in all eight years from 1999 to 2006, then behind in all five years from 2021 to 2025. An even 19 of 38 hides long runs on both sides.
When it fails
As a proxy for small companies in general. Graduation removes the winners. A company that grows from $1 billion to $20 billion spends only part of that climb in the Russell 2000, and the rest of its gain is booked in the Russell 1000.
As a like-for-like comparison across years. The cut-off moved from $1.2 billion to $5.7 billion since 2009, so a small cap in one year’s index can be a large cap in another’s.
Near rebuild dates. Between rank day and the effective date, the lists of likely additions and deletions are public, and index funds must trade at the close on the effective day. Prices of companies on those lists can move for reasons unrelated to the business.
On a price chart held for years. The ^RUT series leaves out dividends. Over long holding periods that understates what an owner received, and it slightly flatters the comparison with any total-return series.
As a volatility match for the S&P 500. Ten-year volatility of 23.5% against 18.1% means the same dollar position swings about 30% more. Sizing a small-cap position like a large-cap one takes on more risk than the number of shares suggests.
Related
The small cap page explains why smaller companies trade with wider spreads and thinner books, which matters more than the index itself when you buy one. Index funds covers the funds that track benchmarks like this one, and volatility explains the measure behind the 23.5% figure. Because the index drops members at every rebuild, survivorship bias is worth reading before trusting any long record of a list that changes its own membership.
When small caps have a strong month, I put the same dates on an S&P 500 chart before I call it a rotation. Over 38 full years the Russell 2000 led in exactly half of them, so one good stretch tells me very little.
— Michael Whitman
This page is educational, not financial advice. Test every idea on your own charts before risking money.