Seattle, Washington-based Russell's index began in 1984 when the firm launched its family of U.S. indices to measure U.S. market segments and hence better track the performance of investment managers.
Using a rules-based and transparent process, Russell forms its indexes by listing all companies in descending order by market capitalization adjusted for float, which is the actual number of shares available for trading.
The members of the Russell 3000E Index and its subsets are determined each year during annual reconstitution and enhanced quarterly with the addition of initial public offerings (IPOs).
However, Russell adds initial public offerings (IPOs) on a quarterly basis, capturing these stocks in a systematic way.
Abnormal trading volumes caused by index fund managers re-balancing their portfolios has a history of significant market impact during the last few seconds before the New York Stock Exchange and NASDAQ closing prices are determined.