The Russell 2000 tracks roughly 2,000 smaller US companies. Its float-adjusted market-cap weighting captures the small-cap segment, whose performance can be sensitive to domestic demand and financing conditions.
History and development
The Russell 2000 belongs to the US index family launched in 1984. It was designed to measure smaller American companies rather than only large businesses. Its universe comes from the smaller members of the Russell 3000; periodic reconstitution keeps that size-based distinction relevant as companies grow or shrink.
References: FTSE Russell: reconstitution history
Comparing charts on this board
Compare the Russell 2000 with the S&P 500 to see whether strength extends beyond large companies. A strong Nasdaq-100 alongside a weak Russell points to large-growth leadership; strength in both shows a broader size range participating.
Add the US two-year yield to examine financing conditions. Falling yields alongside small-cap gains provide an opening to examine easing financial conditions; falling yields with small-cap weakness direct attention to growth concerns. Follow the return gap between the indices.
Related charts: S&P 500 · NASDAQ 100 · US 2Y Yield
Official references: FTSE Russell: Russell 2000