S&P Dow Jones Indices Announces Update to S&P Composite 1500 Market Cap Guidelines

Rhea-AI Summary

S&P Dow Jones Indices (NYSE: SPGI) has announced updated market capitalization eligibility criteria for additions to the S&P Composite 1500 Indices, effective July 1, 2025.

The new thresholds are: $22.7 billion or more for the S&P 500 (up from $20.5B), $8.0 billion to $22.7 billion for the S&P MidCap 400 (up from $7.4B-$20.5B), and $1.2 billion to $8.0 billion for the S&P SmallCap 600 (up from $1.1B-$7.4B).

Companies must also maintain a float-adjusted market capitalization of at least 50% of their respective index's minimum threshold. These criteria apply only to new additions, not existing constituents, and are reviewed quarterly to reflect current market conditions.

Positive

• Market cap thresholds increased across all indices, reflecting overall market growth
• Regular quarterly reviews ensure criteria remain aligned with current market conditions
• Clear guidelines maintain index quality with specific percentile targets (85th-99th) for each index

Negative

• Higher market cap requirements may limit the number of companies eligible for index inclusion

Insights

Index and ETF Strategist

S&P DJI raised market cap thresholds for its indices, reflecting market growth and potentially impacting index fund flows and company valuations.

S&P Dow Jones Indices has increased the market capitalization thresholds for additions to its widely tracked S&P Composite 1500 indices. The S&P 500 minimum threshold rises $2.2 billion to $22.7 billion, the MidCap 400 range adjusts to $8.0-$22.7 billion (from $7.4-$20.5 billion), and the SmallCap 600 range increases to $1.2-$8.0 billion (from $1.1-$7.4 billion).

These adjustments represent increases of approximately 10.7% for the S&P 500 threshold, 8.1% for the MidCap 400 upper boundary, and 9.1% for the SmallCap 600 upper limit. The changes reflect broader market appreciation and help maintain the indices' intended market segment representation (85th percentile for S&P 500, 85th-93rd for MidCap, and 93rd-99th for SmallCap).

This recalibration has several implications. Companies near previous thresholds that haven't crossed the new boundaries may experience delayed index inclusion. Conversely, companies that have grown past the old thresholds but below the new ones might face unexpected non-inclusion. Additionally, companies currently in indices that fall below these new thresholds won't be automatically removed, as these criteria only apply to new additions.

For investors, these changes particularly impact index funds and ETFs tracking these benchmarks, as future reconstitutions will reflect these new thresholds. The higher requirements also illustrate the ongoing growth in overall market capitalization across U.S. equities, with the adjustments maintaining the indices' intended representation of specific market segments.

NEW YORK, July 1, 2025 /PRNewswire/ -- S&P Dow Jones Indices ("S&P DJI") is updating the market capitalization eligibility criteria for additions to the S&P Composite 1500 Indices. Effective July 1, 2025, the size ranges will be updated as follows:

Previous Market Capitalization Eligibility Criteria	Updated Market Capitalization Eligibility Criteria
Unadjusted company market capitalization of: •  US$ 20.5 billion or more for the S&P 500 •  US$ 7.4 billion to US$ 20.5 billion for the S&P    MidCap 400 •  US$ 1.1 billion to US$ 7.4 billion for the S&P    SmallCap 600	Unadjusted company market capitalization of: •  US$ 22.7 billion or more for the S&P 500 •  US$ 8.0 billion to US$ 22.7 billion for the S&P    MidCap 400 •  US$ 1.2 billion to US$ 8.0 billion for the S&P    SmallCap 600

These market capitalization ranges are reviewed at the beginning of every calendar quarter, updated as needed to ensure they reflect current market conditions, and expressed in dollar ranges. These minimum market capitalization guidelines are designed to capture the three-month average cumulative total company level market capitalization of the S&P Total Market Index ("TMI") universe at approximately the following cumulative percentiles:

• S&P 500 – 85th percentile
• S&P MidCap 400 index – 85th-93rd percentile
• S&P SmallCap 600 index – 93rd-99th percentile

Companies passing the total company-level market capitalization criteria must also have a security level float-adjusted market capitalization (FMC) that is at least 50% of the respective index's total company-level minimum market capitalization threshold.

As a reminder, the market capitalization eligibility criteria are for additions to an index, not for continued membership. As a result, an index constituent that appears to violate criteria for addition to that index is not removed unless ongoing conditions warrant an index change.

A history of market cap ranges dating back to 2007 can be found in Appendix A of the U.S. Indices methodology. The U.S. Indices methodology document will be updated soon to reflect the changes. Please visit our website www.spglobal.com/spdji for further details.

For more information about S&P Dow Jones Indices, please visit www.spglobal.com/spdji

ABOUT S&P DOW JONES INDICES

S&P Dow Jones Indices is the largest global resource for essential index-based concepts, data and research, and home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average®. More assets are invested in products based on our indices than products based on indices from any other provider in the world. Since Charles Dow invented the first index in 1884, S&P DJI has been innovating and developing indices across the spectrum of asset classes helping to define the way investors measure and trade the markets.

S&P Dow Jones Indices is a division of S&P Global (NYSE: SPGI), which provides essential intelligence for individuals, companies, and governments to make decisions with confidence. For more information, visit www.spglobal.com/spdji.

FOR MORE INFORMATION:

S&P Dow Jones Indices
index_services@spglobal.com

Media Inquiries
spdji.comms@spglobal.com

View original content:https://www.prnewswire.com/news-releases/sp-dow-jones-indices-announces-update-to-sp-composite-1500-market-cap-guidelines-302496221.html

SOURCE S&P Dow Jones Indices

FAQ

What are the new market cap requirements for S&P 500 index inclusion in 2025?

As of July 1, 2025, companies must have an unadjusted market capitalization of $22.7 billion or more to be eligible for S&P 500 index inclusion.

How much did the S&P MidCap 400 market cap requirements change in July 2025?

The S&P MidCap 400 market cap range increased to $8.0 billion to $22.7 billion, up from the previous range of $7.4 billion to $20.5 billion.

What is the minimum market cap for S&P SmallCap 600 inclusion in 2025?

Companies must have a market cap between $1.2 billion and $8.0 billion to be eligible for inclusion in the S&P SmallCap 600 index.

Do existing S&P Composite 1500 companies need to maintain these new market cap requirements?

No, these market capitalization eligibility criteria are only for additions to an index, not for continued membership, unless ongoing conditions warrant an index change.

What float-adjusted market cap requirement must companies meet for index inclusion?

Companies must have a security level float-adjusted market capitalization (FMC) that is at least 50% of their respective index's total company-level minimum market capitalization threshold.