Russell's annual reconstitution of the 3,000 stocks in its U.S. indexes will probably see General Electric Co. dominating the large-cap style changes, as the stock is likely to be reclassified from 100% growth to 92% value-8% growth, based on index criteria, according to a report issued today by Goldman Sachs. GE, which has a $317.8 billion market cap, is the largest stock in the Russell 3000.
Microsoft Corp., a 100% growth stock, could be reclassified as 77% growth-23% value, the report notes. Also, Caterpillar Inc. and Schering-Plough Corp. could both move to 100% growth from their current 100% value.
Index funds, including exchange-traded funds, have $332 billion benchmarked to the Russell 3000 indexes, including $158.1 billion to the Russell 3000 index alone, according to the report. Russell plans to start posting preliminary lists of additions and deletions to the Russell 3000 indexes on its website on June 11; the final list will be posted July 6.
