Tesla Stock Set to Join the S&P 500 Index

On Monday, S&P Dow Jones Indices (“S&P DJI”) announced that “it will add Tesla to the S&P 500 at its full float-adjusted market capitalization weight effective prior to the open of trading on Monday, December 21, 2020.”

Following the news, Tesla’s shares rose up 5%.

In November, S&P DJI asked investors if it should add the stock TSLA, -3.10% in tranches, or at once, while its value exceeded the benchmark index by $551 billion. 

S&P DJI stated that the decision was made after considering “the wide range of responses it received,” as well as “the expected liquidity of Tesla and the market’s ability to accommodate significant trading volumes on this date.”

On December 11, S&P Dow Jones Indices will announce the name of the company whose benchmark index will be replaced by Tesla.

By joining the S&P 500, Tesla would become the sixth-largest company on the index by market value, adding its stock to numerous holdings portfolios. 

Following its latest stock rise, the company’s market cap exceeded $500 billion from its $100 billion January valuation.