This Friday HDY is guaranteed to pop because every June, Russell Investments, which is the company behind the well-known small-cap benchmark Russell 2000 index, changes its lists of component stocks for several of its indexes. Inevitably, the index reconstitution leads to some up-and-coming companies making it into the benchmarks, replacing those companies that no longer qualify for inclusion. Given that this happens every year, you'd think that everyone would treat it as a non-event. But with nearly $4 trillion of institutional investments tied to Russell's indexes, there's a ton of money at stake -- and with the many index funds and other money managers that have to follow Russell's moves, you can expect to see substantial volatility as the changes become final on June 24. HDY is in a highly promising position to guarantee you so quick cash for this Friday trading. All the fuss these and many other stocks will see later this week stems from the institutions that track Russell's indexes. For instance, index funds that try to mimic the performance of the Russell 3000 will have to buy all the new additions to the index while selling their holdings in the stocks that are leaving.
Especially with smaller-cap stocks, which aren't always very liquid, the huge amount of institutional attention can move markets substantially in the short run. So if the stocks that are new additions to the index interest you, you may want to buy them today rather than waiting until next week. On the other hand, if you think they've come too far too fast, then waiting a while to take advantage of share-hungry index funds might get you a better price.