what is the russell 2000

The Russell 2000 is a stock market index that measures the performance of approximately 2,000 smaller companies included in the Russell 3000 Index. It was launched in 1984 by the Frank Russell Company and is now managed by FTSE Russell, a subsidiary of the London Stock Exchange. The Russell 2000 is market cap-weighted, meaning that the amount that each company accounts for in the index is determined by the size of the companys market cap, or the total value of its shares outstanding. As of May 31, 2023, the average value for a company on the Russell 2000 was $2.96 billion while the median market cap was $0.93 billion. The largest stock by market cap on the index was $12.01 billion. The Russell 2000 is often cited along with more popular stock-market indexes such as the S&P 500, the Dow Jones Industrial Average, and the Nasdaq Composite. The index is more diversified than other popular indexes such as the S&P 500 because it focuses on smaller companies and contains 2,000 of them. The Russell 2000 is composed of smaller and more volatile stocks than those in large-cap indexes, but the large number of companies in the index helps to mitigate the risk since its less reliant on any particular stocks performance.