SpaceX joins index, micro-cap and value gain ground, and concentration remains elevated, headlining a quarter showcasing the ability of the Morningstar Market Indexes to evolve with changing markets, maintaining the most comprehensive, efficient, accurate representation of the entire investable U.S. equity market

Morningstar, Inc. (NASDAQ:MORN), a leading provider of independent investment insights, announced the completion of the third quarter reconstitution for the Morningstar Market Indexes.

Conducted quarterly to reflect changes across the U.S. equity market, the reconstitution helps ensure the indexes continue to serve as robust, representative, and investable benchmarks for investors. Built on CRSP’s long-established methodology, research foundation, and academic heritage, and now under the Morningstar banner, the Morningstar Market Indexes currently underpin more than $3 trillion in investor assets.

This includes more than $2 trillion linked to the Morningstar US Total Market Index, the parent for the Morningstar Market Indexes, making the update an important event for investors, asset managers, and market participants following the index. Additionally, Morningstar’s research, analytics, and investment platforms will begin using the Morningstar Market Indexes as category benchmarks in the fourth quarter.

"Our quarterly reconstitution is more than an index maintenance event. It provides a transparent and objective view into how the U.S. equity market is evolving and ensures benchmarks continue to reliably reflect the opportunity set for stock investors," said Amelia Furr, president of Morningstar Indexes. "What sets our indexes apart is a methodology designed to capture the most comprehensive U.S. equity opportunity set while minimizing unnecessary turnover. By systematically incorporating major market events ― from IPOs to shifts in company size and style ― we help investors maintain the broadest market exposure without introducing excessive trading caused by short-term market movements."

At the core of the reconstitution is the Morningstar US Total Market Index, Morningstar’s flagship U.S. equity benchmark, designed to capture the entire U.S. stock market. The index serves as the foundation for many of the industry’s most widely used index-linked investment products, including the world’s largest mutual fund, and is a critical barometer of changes shaping the U.S. equity landscape.

"While SpaceX dominated the headlines three months ago, its IPO has had only a modest impact on the US Total Market Index so far, largely due to its limited free float," said Alex Poukchanski, director of analytics at Morningstar Indexes. "Because our flagship index represents the entire U.S. equity market, we can capture emerging market trends. For example, beneath the surface, market leadership has broadened. While the top end of the U.S. stock market remains relatively concentrated, micro caps and value stocks have outperformed larger growth companies, underscoring the importance of diversification and exposure across size and style segments."

Highlights from the third quarter reconstitution

SpaceX Lands Quietly. Morningstar’s innovative "fast-track" IPO inclusion methodology, designed to accommodate today’s evolving market landscape in which private companies increasingly enter the public markets later and at significant scale, brought SpaceX into the Morningstar Market Indexes five days after its widely watched IPO in June. While this high-profile mega-cap IPO garnered significant market interest and reached a $2 trillion market capitalization on its first day of trading, the stock represented just 0.1% of the Morningstar US Total Market Index at the end of August, reflecting limited public float available to end investors.
Micro-Cap & Value Stocks Gain Momentum. While the mega-cap growth narrative continues to dominate investor attention, recent Morningstar Market Indexes performance points to a potential inflection point, with micro-cap and value-oriented stocks gaining momentum. The Morningstar US Micro Cap Index has outperformed all other size segments over the past year, rising nearly 22% year-to-date through Sept. 4 (reconstitution "ranking day"). Although AI-driven price appreciation from March to June showed durability, the Morningstar Market Indexes style assignment methodology indicates that style movements were also partly driven by changing fundamentals, as Intel (INTC), Applied Materials (AMAT), Dell (DELL), and Corning (GLW) moved from value to growth, while McDonald’s (MCD), Uber (UBER), Adobe (ADBE) and Intuit (INTU) moved from growth to value.
Market Concentration Remains Elevated. At the September reconstitution, the 10 largest companies in the Morningstar US Total Market Index accounted for 35% of total market capitalization, a level of concentration similar to that seen in June and down slightly from 36% in December 2025. While the 10 largest stocks in the index retained their positions from quarter-to-quarter, the number of mega-cap companies in the index dropped to 165, its lowest point in a decade, underscoring the impact of the top-level concentration.

"Index rebalancing shouldn't create unnecessary costs for investors," added Rodney Comegys, chief investment officer of Vanguard Capital Management and head of Global Equity. "One reason Vanguard has long valued the Morningstar methodology is its use of gradual transitions, which help reduce turnover and market impact when companies move between market segments. It's a thoughtful approach that can improve implementation efficiency, reduce costs, and ultimately benefit long-term shareholders."

More information about the Morningstar Market Indexes and the quarterly reconstitution is available here.

About Morningstar, Inc.

Morningstar, Inc. (the "Company") is a leading provider of independent investment insights in North America, Europe, Australia, and Asia. The Company offers an extensive line of products and services for individual investors, financial advisors, asset managers and owners, retirement plan providers and sponsors, institutional investors in the debt and private capital markets, and alliances and redistributors. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, debt securities, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with approximately $370 billion in assets under management and advisement (AUMA) as of June 30, 2026. The Company operates through wholly- or majority-owned subsidiaries in 32 countries. For more information, visit www.morningstar.com/company.

About Morningstar Indexes

Morningstar Indexes was built to keep up with the evolving needs of investors — and to be a leading-edge advocate for them. Morningstar's rich heritage as a transparent, investor-focused leader in data and research uniquely equips Morningstar Indexes to support individuals, institutions, wealth managers and advisors in navigating investment opportunities across all major asset classes, styles, and strategies. In February 2026, the acquisition of CRSP brought the CRSP Market Indexes ― benchmarks for over $3 trillion in AUM ― into the Morningstar Indexes family. Additionally, CRSP’s Research Data Products, renowned for their academic rigor, historical depth and accuracy, further enhances Morningstar’s equity research and data capabilities. This powerful combination unites two trusted sources of market insight, reinforcing a shared commitment to transparency, quality and investor-focused solutions.

Please visit indexes.morningstar.com for more information.

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Tim Benedict, +1 203 339-1912, tim.benedict@morningstar.com

Allison Phelps, +1 312 244-7358 or newsroom@morningstar.com