September’s quarterly rebalance will see five stocks added and five removed from the benchmark S&P/ASX 200, as part of broader index changes that could generate almost US$1 billion in passive trading flows across the S&P/ASX 300, according to Goldman Sachs research.

After market close on September 18, five stocks will be added to the S&P/ASX 200 including drone technology operator Elsight (ASX: ELS), salary-packaging provider Smartgroup (ASX: SIQ), battery-metals developer Sunrise Energy Metals (ASX: SRL), infrastructure services group Service Stream (ASX: SSM) and semiconductor developer Weebit Nano (ASX: WBT).

Deletions from the index include cinema operator EVT (ASX: EVT), agribusiness group GrainCorp (ASX: GNC), asset manager GQG Partners (ASX: GQG), gold producer Pantoro (ASX: PNR) and telecommunications provider Taus (ASX: TUA).

The changes are part of a broader reshuffle that also includes 16 constituent changes to the S&P/ASX 300. 

Index changes prompt automated flows 

Index-tracking portfolios will need to trade to ensure their holdings continue to reflect the composition and weightings of the S&P/ASX 200 after the changes take effect. 

Goldman Sachs Global Investment Research estimates the S&P/ASX 200 changes could generate around US$474 million of gross two-way passive trading. When incorporating the 16 constituent changes across the S&P/ASX 300, that rises to US$997 million.

Goldman estimates industrial and infrastructure-related businesses could receive US$187 million in net passive inflows, while metals and mining could attract about US$112 million. Consumer retail, internet and media, banks and consumer staples are among the sectors facing outflows relating to removed stocks.

A recent example of how reweighting can prompt huge amounts of mechanical demand is SpaceX. JPMorgan Securities estimates the company’s weighting within the Nasdaq-100 could rise from around 1.25 per cent currently to 2.25 per cent at September’s quarterly rebalance. 

That could prompt as much as US$15.5 billion of net passive buying expected from index funds and ETF providers, according to the same research. The next rebalancing of the Nasdaq-100 will take effect on September 21.

Why index moves can reverse

A sharp move around an index rebalance may reflect mechanical buying or selling rather than a new assessment of a company’s earnings or long-term prospects.

Dimensional Fund Advisors observed this effect in its research ‘Measuring the Costs of Index Reconstitution: A Global Perspective’ which examined 15 major US and international indices, including the S&P/ASX 300.

It found index additions tended to rise in price ahead of when funds had to buy them at a reconstitution event, while deletions tended to fall ahead of selling. Both then exhibited reversals in those price changes following reconstitution day.

Figure 1 S&P/ASX 200 September 2026 Rebalance

	Stocks Added to S&P/ASX 200	Ticker	Sector / Industry
	Elsight	ELS	Drone technology
	Smartgroup	SIQ	Salary packaging / financial services
	Sunrise Energy Metals	SRL	Battery metals / mining
	Service Stream	SSM	Infrastructure services
	Weebit Nano	WBT	Semiconductor technology

 

	Stocks Removed from S&P/ASX 200	Ticker	Sector / Industry
	EVT	EVT	Entertainment / cinemas
	GrainCorp	GNC	Agribusiness
	GQG Partners	GQG	Asset management
	Pantoro	PNR	Gold mining
	Taus	TUA	Telecommunications

 

Across the 15 indices that formed part of the 2025 study, the average excess return to affected stocks was 3.9% over the 20 days leading up to reconstitution, followed by a reversal of 4.4% over the subsequent 20 days after reconstitution.

Reconstitution day is when announced index changes take effect, requiring index-tracking funds to adjust their holdings to match the new composition and weightings.

Trading activity also typically surges on these days. Dimensional found volume in affected stocks averaged 23 times normal levels on reconstitution day.

Rebalancing as part of disciplined portfolio construction

Rather than treating index changes as a buy or sell signal, advisers can use the event to ensure any portfolio exposures are consistent with a client’s strategic asset allocation and risk profile.

According to Vanguard’s investment principles, rebalancing – or periodically adjusting a portfolio back towards its target asset allocation – is an important investment discipline for keeping a client’s investment strategy aligned with their long-term goals.

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