LOS ANGELES, Calif. ( TheStreet) -- KB Home ( KBH - Get Report)has been dropped from the S&P 500 Index, as part of a broad capitalization reshuffle by S&P across some of its biggest equity benchmarks.

Exchange-traded funds based on the big S&P indexes are heavily traded on a daily basis, but the move down by KB Home means it is now part of an index with drastically less daily volume. For example, the iShares S&P MidCap 400 Index exchange traded fund has average daily volume of 764,000 shares daily. The SPDR S&P 500 trades 173 million shares daily and is constantly among the NYSE most actives list.

While losing its spot in the biggest index brand, KB Home was swapped into the S&P MidCap 400 Index.

S&P MidCap 400 constituents Ross Stores ( ROST - Get Report), Cliffs Natural Resources ( CLF - Get Report) and SAIC ( SAI) moved up to the S&P 500.

Dynegy
( DNY), KB Home and Convergys ( CVG) all moved down to the S&P MidCap 400.

The S&P said it made the index changes to better reflect market capitalization ranges. The companies moving to the S&P 500 all have market caps above $5 billion; the companies moving to the S&P MidCap 400 all have market caps between $1 billion and $3 billion.

KB Home was down 1.4% in early morning trading Monday.

-- Reported by Eric Rosenbaum in New York.

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