SP 600 Index

The SP 600 Index is an equity index representing 600 small-sized companies in various industries. The SP 600 Index is also called the SP SmallCap 600 Index. The SP 600 Index was launched in 1994. The SP 600 Index is a benchmark for evaluating the investment potential of profitable small companies. Although the SP 600 Index is not as liquid as its counterpart, the Russell 2000 Index, the SP 600 Index is more selective in which company can be included which results in an index with stronger and more viable companies. The SP 600 Index represents about 3% of the entire U.S. equity market. The SP 600 Index is weighted by market capitalization. The SP 600 Index includes small cap stocks with market capitalization ranging from about US$300 million dollars to about US$2 billion. To be included in the SP 600 Index, a company must be a US company with strong financials (i.e. as reported earnings must be positive for 4 quarters in a row). An SP 600 Index company must have good liquidity. An SP 600 Index company must also be an operating type of company (i.e. no holding companies for example but REITs are allowed). The SP 600 index is calculated by Standard and Poor's in accordance with published specifications. The SP 600 Index is reconstituted on an as needed basis by SP economists, index experts, and members of the SP Index Committee. In 2005, Standard and Poor's developed sub indices to the SP 600 Index. The SP 600 sub-indices are part of the SP/Citigroup Style index series. The SP 600 sub-indices are listed as SP Composite 600/Citigroup growth and value indices and SP Composite 600/Citigroup pure growth and pure value indices. Various Exchange traded Funds (ETF) (i.e. iShares SP SmallCap 600 Fund) and mutual funds offer investment vehicles to trade the SP 600 Index.

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