The End of Increasing Index Concentration

On March 21, 2025, a new era dawned with the official end of an ever-increasing concentration in the Russell 1000® Growth Index (“Index”). Mega weights, defined as 4.5% or greater, had minimal representation in the Index until 2016 when these weights began a virtuous compounding cycle to represent 50.8% of the Index as of January 31, 2025. It is informative to note that the rise of the mega weights was not just driven by price appreciation, but also by FTSE Russell (“Russell”) reweighting the largest names higher during its annual Index reconstitution. Russell’s rigid rules-based methodology has reweighted the top six stocks higher by 6.5% over the last five years.