S&P Dow Jones Raises Market Cap Guidelines for S&P 500

In a release on June 19th the S&P Dow Jones US Index Committee raised the market cap guidelines used when selecting companies for the S&P 500, S&P  Mid Cap 400 and S&P Small Cap 600. The new guidelines are:

  • S&P 500: Over $4.6 billion, raised from $4 billion
  • S&P Mid Cap 400: $1.2 to $5.1 billion, raised from $1 to $4.4 billion
  • S&P SmallCap 600: $350 million to $1.6 Billion, raised from $300 million to $1.4 billion

The changes reflect the market’s movement since the bottom in March 2009 and especially in the last two years of gains.  The last increase was almost two and a half years ago in February, 2011.   Given the recent gains, what makes a company an S&P 500 Company is a somewhat bigger hurdle than it was two years ago.  The Index Committee monitors market developments as well as events affecting the indices. The guidelines help determine which index a company should be added to.  Market cap is not the only factor affecting the selection of companies for the S&P 500 and our other indices.  Other criteria include what sector the company is in, its liquidity and financial viability and that it must be a U.S. company.

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