Index Exchange Traded Funds (ETFs) & Tracking Stocks
- Russell 2000
Stock Market Investing &
Trading System
The Russell 2000 Index was created in 1984 by Frank Russell Company and
was designed to track the performance of small-cap companies. Russell 2000
Index ETF (Exchange Traded Fund), trading exclusively at the
AMEX
Exchange, make it simple to participate in the small-cap market.
The weighted average market
capitalization for companies in the Russell 2000 is about US$1 billion and the
index itself is considered to be the benchmark for all small cap mutual funds.
The Russell 2000
serves as a good benchmark for small-cap investments, and index funds based on
it have done quite well.
The popularity of the Russell 2000 as a small-cap benchmark leads to
four fundamental reasons for using RUT options:
Exchange Traded Funds (ETFs) & iShares
|
Securities |
Issuer |
Type |
Symbol / Root |
|
Russell 2000 Growth Index Fund |
AMEX |
ETF |
IWO |
|
Russell 2000 Index Fund |
AMEX |
ETF |
IWM |
|
Russell 2000 Value Index Fund |
AMEX |
ETF |
IWN |
|
Russell 2000 Index "MITTS" |
Merrill Lynch |
ETF |
RSM |
|
Russell 2000 Index "MITTS" |
Merrill Lynch |
ETF |
RUM |
|
About Russell 2000 Index Funds & ETFs
Investors are able to trade a broad market by making one
Russell
2000 Index ETF (Exchange Traded Fund) trading decision rather than making the
many decisions involved with investing in numerous individual stocks.
Insurance
Russell 2000 Index ETFs (Exchange Traded Funds) offer a convenient and
easy way to help reduce the market risk of a broad market portfolio of
many small-cap stocks, without disrupting the make-up of the portfolio.
Leverage
Purchasing
Russell
2000 Index ETFs, instead of buying or selling thousands
of individual stocks, provides an investor with an additional opportunity
to use investment capital elsewhere. For a relatively small percentage
gain in the underlying index, a Russell 2000 Index ETFs can increase in
value by a multiple of that gain.
| 
