Indices · Index specialist topics · lesson 2 of 9 · 8 min read · David Alexander
Rebalancing and reconstitution
reconstitution
The scheduled application of the methodology, which changes the constituent list. Rebalancing adjusts existing weights; reconstitution adds and removes companies. Both force every tracking fund to trade on the same date, in the same direction, in the same shares.
This lesson is part of the advanced modules.
Modules 6 to 8 are included with a paid account. The definitional summary above is the whole of this page until then.