The Russel 1000 Index represents the top 100 US companies as measured by their market capitalisation.
It is a market capitalistion weighted index which means that the larger the constituent company (by capitalisation) the larger the percentage of the index it represents. So larger companies within the index will affect the performance more than the smaller ones.
It is what is called a subset of the Russel 3000 Index.
It is by many regarded as the bell-weather index for stocks in the US, often referred to the more well-known Dow Jones Industrial Average and S and P 500 indices.
It represents roughly 92% of the whole of the US Stock Market.
Each year the index is assessed and some companies at the lower end of the index are exchanged for some companies that get promoted from the Russel 2000 Index.
At the time of writing the largest constituent by market capitalisation was Microsoft at a hefty $1.24 Trillion.
The average market capitalisation of the Russel 1000 was $265 Billion.
Many investors prefer the Russel 1000 Index to both the Dow Jones Industrial Average and the S and P 500. Maybe that's because it contains a more balanced portfolio.
Again, at the time of writing, the top 10 constituents were (in alphabetical order):
The top sectors within the Russel 1000 Index, by weight, are:
iShares offer an Exchange Traded Fund (the iShares Russell 1000 Index ETF) which attempts to track the Russel 1000 Index accurately.
The Russel 1000 Index has proved to be a reliable alternative as a benchmark index to both the Dow Jones Industrial Average (comprising of only 30 stocks) and the S and P 500 Index (500 stocks).
In a Self Invested Personal Pension you could trade the iShares Exchange Traded Fund (ETF) but it would not be our first choice of ETF (see Exchange Traded Products).
Chris and Clem Meet Up - hopefully, the last time before lockdown easing
Chris and Clem Meet Up - at last! They can meet in the beer garden
Chris and Clem Meet Up and it is Chris' turn to do most of the talking. Chris' little windfall has allowed him to widen his portfolio. Chris vows of more.