SOURCE: Russell Investments

Russell Investments

June 19, 2009 13:13 ET

Russell Indexes Set to Welcome Stocks From 40 States

Annual Process Sees More Health Care Firms and Fewer Energy Stocks

TACOMA, WA--(Marketwire - June 19, 2009) - Pennsylvania and New York lead the list of states with the greatest number of net additions set to flow into the broad-market Russell 3000 Index when the index is fully reconstituted on June 26. Pennsylvania shows 17 firms on the preliminary list of additions posted on russell.com and only two firms on the list of deletions for a net increase of 15 stocks in the index.

Other states with the most net additions set for inclusion are New York (26 additions, 13 deletions), California (46 additions, 34 deletions), Massachusetts (17 additions, five deletions), and Minnesota (12 additions, one deletion).

The lists also show that 40 of the 50 states are represented with at least one stock on the additions list, while 34 states are represented on the list of deletions.

Looking separately at the list of additions and deletions, California shows up most often on both. Eight states show more deletions than additions: Alabama, Connecticut, Hawaii, Iowa, Indiana, Nevada, Tennessee and Texas. Four states don't appear on either list: Idaho, New Mexico, North Dakota and West Virginia.

The city with the largest number of net additions is Philadelphia, where six firms are set to join the Russell 3000 and zero are set for removal. New York City tops both lists with nine deletions and seven additions.

Looking at the nine sectors, health care shows a net addition of 52 stocks, including 24 pharmaceuticals, while energy shows a net decrease of 14 stocks, including 10 non-renewable energy stocks. However, the financial services sector leads both the list of additions (+69) and list of deletions (-39). Both lists are dominated by banks which account for 49 of the additions and 21 of the deletions.

"Index reconstitution objectively captures the changing fortunes of companies and industries in the U.S. equity market," said Lori Richards, client service director for Russell Indexes. "The process reveals which sectors and states fared relatively well during the past year's recession."

Most of the deletions from the Russell 3000 will drop into the Russell Microcap® Index.

Annual reconstitution of Russell U.S. and global indexes captures the investable universe of stocks and ranks them by total market capitalization. On June 12, Russell posted its preliminary lists of companies set for addition to -- or deletion from -- the ranking of stocks that make up its U.S. equity indexes as well as the Russell Global Index. Final index membership remains in place for one year. The lists of additions and deletions for the Russell 3000 and the Russell Global Index are posted at http://www.russell.com/Indexes/membership/reconstitution/default.asp.

Russell's index reconstitution process is followed closely by many investors because the Russell indexes currently have about $4 trillion in assets benchmarked to them and account for an industry-leading 63% of all institutional investment products that use a benchmark.

About Russell

Russell Investments provides strategic advice, world-class implementation, state-of-the-art performance benchmarks and a range of institutional-quality investment products. Russell has more than $136 billion in assets under management as of March 31, 2009, and serves individual, institutional and advisor clients in more than 40 countries. Founded in 1936, Russell is a subsidiary of The Northwestern Mutual Life Insurance Company.

Russell Investments is the owner of the trademarks, service marks and copyrights related to its indexes. Russell's indexes are unmanaged and cannot be invested in directly.